Allen Gibbs purchased 50 shares of ABC Corp., each worth $110. If the price of the share increases to $135 after a year, which of the following will be the capital gain if Allen sells all his shares?
A) $1,250
B) $25
C) $6,750
D) $5,500

Question

Quizplus · Accepted Answer

The capital gain is calculated by subtracting the total purchase price from the total selling price. Allen bought 50 shares at $110 each, totaling $5,500 (50 * $110). He sold them at $135 each, totaling $6,750 (50 * $135). The capital gain is $6,750 - $5,500 = $1,250.

Allen Gibbs Purchased 50 Shares of ABC Corp