Question

P acquired HHH stock at various times and at various prices over the past three years...

  1. P acquired HHH stock at various times and at various prices over the past three years as shown below. P sold 100 shares of HHH stock for $20,000 in 2020, but he cannot identify the particular shares that were sold. How much gain must P report on the sale?

         P bought 50 shares of HHH stock in 2014 for $3,000.

         In 2016 P bought 100 shares of HHH stock for $5,000

         In 2018 P bought 200 shares of HHH stock for $9,000

         In 2019 P bought 100 shares of HHH stock for $4,500

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Answer #1

Details of HHH Stocks Shares Purchased by P

Year

No. of Shares

Total price

2014

50

3000

2016

100

5000

2018

200

9000

2019

100

4500

Total

450

21500

Average price of a Share of HHH stock =   21500/450= 47.77

Selling price of 100 Shares                                 = 20000

Less. Cost price of 100 Shares (47.77*100)    =   4777

Gain on sale of 100 Shares    = 15223

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