Answered: A stock dealer sold 5,000 shares…

A stock dealer sold 5,000 shares directly to the buyer. The details are as follows: Selling price P800,000 Cost 300,000 Expenses on sale 50,000 Compute the capital gains tax on the transaction.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter10: Stockholder's Equity

Section: Chapter Questions

Problem 12MCQ

See similar textbooks

Related questions

Q: Swifty Corporation sold 310 shares of treasury stock for $35 per share. The cost for the shares was…

A: Treasury stock: Shares which are bought back by the company from the open market but not retired…

Q: The Divirgil Company Net Income is $100. Given the following items: Purchase of debt securities…

A: It is a financial statement that shows the increase or decrease in the cash and cash equivalents…

Q: The Sneed Corporation issues 10,000 shares of $50 par preferred stock for cash at $75 per share.…

A: Paid in capital in excess of par = (Issue price per share - Face value per share) x No. of shares =…

Q: Assume the issuer incurs $1 million in other expenses to sell 3 million shares at $40 each to an…

A: Number of Shares Issued: 3 millionOffering Price: $40First-day Closing Price: $70

Q: You are given the following information for Lighting Power Company. Assume the company's tax rate is…

A: Here, Cost of debt: No. of bonds outstanding 21,000.00 Coupon rate 7.00% Maturity period…

Q: Clayton Industries has the following account balances. Current assets $ 25,000 Current liabilities $…

A: The current ratio is computed by dividing the total current assets by the total current liabilities.…

Q: ed 16,000 common shares of Heller Co. at $16 cash per share. a cash dividend of $1.25 per common…

A: Accounting equation :The accounting equation states that the total assets will equal the sum of…

Q: Suppose a company purchases 2,000 shares of its own $1 par value common stock for $16 per share. The…

A: Treasury stock is the stock which is bought back by the issuing company. It is also known as…

Q: with a par value of P 5 per share for P 8 per share. How much is the income tax of the said…

A: Capital gains arises when any Capital assets are transferred and such gains are subject to taxes.…

Q: An investor purchased 500 shares of common stock, $25 par, for $19,250. Subsequently, 100 shares…

A: Common stock: Common stock is the instrument used by the company for raising funds from the…

Q: May 1, Republic Corporation purchased 400 shares of stock for P114 per share and held it as FVTPL…

A: When an investment is classified as FVTPL financial assets, dividend income is recorded in statement…

Q: A stock dealer sold 5,000 shares directly to the buyer. The details are as follows: Selling price.…

A: Gain or loss on capital gain refers to the amount of selling price which is more the the total cost…

Q: 5000 shares of stock were purchased at $25 per share with a 5% broker commission. The following…

A: a) Computation of Cost of Investment:

Q: On October 1, you sold short 100 shares of Wayne stock at $25 per share. On December 1, a dividend…

A: A short sale is a type of financial transaction where an investor sells a financial item that they…

Q: share. Calculate the investor's: a. Income b. Capital gain c. Total dollar return

A: a. Calculation of Income:Dividend received during the year will be the income for the investor which…

Q: You are given the following information for Lighting Power Company. Assume the company's tax rate is…

A: Weighted cost of capital refers to the average cost incurred for issuing bonds and stocks in a…

Q: If an investor purchased 150 shares of Sunoco stock at $83.43 and the brokers commision was 2.5%,…

A: Stock exchange is a group of broker hence all the stocks that are bought and sold through stocks are…

Q: es Myers Drugs Inc. has 3 million shares of stock outstanding. Earnings after taxes are $6 million.…

A: EPS means earnings per share being earned by each shareholder of the company. Formula to calculate…

Q: 2) Andrew bought 10,000 shares of stock B at $2 per share. At the end of the year, he sold all the…

A: Ans.2) Number of shares in investment= 10,000 Purchase price per share = $2. Therefore, total value…

Q: On January 1, Star Corp sold 10,000 shares of stock at $26 per share. Later in the year, Star Corp…

A: Treasury stock is a contra-equity account that represents the company's own shares that it has…

Q: 2. Suppose that you owned 1000 shares of stocks in SM. You purchased the shares at a price of Php856…

A: Purchase value = 1,000 x 856 = 856,000 Sales value = 1,000 x 835 = 835,000

Q: Now ant evaluating the balance sheet for Mari Corporation. from the balance sheet you find the…

A: The difference between a company's current assets and current liabilities as shown on its balance…

Q: Vaughn Corporation sold 390 shares of treasury stock for $55 per share. The cost for the shares was…

A: A journal entry is a formal accounting record used to capture and record financial transactions in a…

Q: An investor purchased 500 shares of common stock, $25 par, for $19,250. Subsequently, 100 shares…

A: Definition of Capital Gain/Loss:Capital Gain is a profit one earns on the sale of an asset like…

Q: SLM, Inc., with sales of $800, has the following balance sheet: SLM, Incorporated Balance Sheet…

A: A. Determine the balance sheet entries for sales of 1400 using the percent of sales forecasting…

Q: An investor bought 200 CYH shares with a par value of P1.00 per share at P50.00. He received cash…

A: Capital Gain: It is the growth in the value of a capital asset that results in the realization of a…

Q: ermediate calcul-

A: Formula to calculate the basic EPS is: Basic EPS = Earnings after tax/No of outstanding shares…

Question

A stock dealer sold 5,000 shares directly to the buyer. The details are as
follows:
Selling price
P800,000
Cost
300,000
Expenses on sale
50,000
Compute the capital gains tax on the transaction.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

A stock dealer sold 5,000 shares directly to the buyer. The details are as follows: Selling price. P800,000 Cost 300,000 Expenses on sale 50,000 Compute the capital gains tax on the transaction. 75,000 67,500 50,000 Zero Answer is 67,500 how was it solved?
Show your solution.
Q2. On 1 July 2020 Farfalle pc had 5 million £1 ordinary shares in issue. On 1 September2020, Farfelle made a bonus issue of 1 for 2. Its profit after tax for the year ended 30 June 2021 is £3.8m. An ordinary dividend of £1.8m was paid(i) Calculate the earnings for year ended 30 June 2021(ii) Calculate basic EPS for the year ended 30 June 2021 to the nearest pence
On October 1, you sold short 100 shares of Wayne stock at $25 per share. On December 1, a dividend of $3 per share was paid. On Jan 1, you covered the short sale by buying the stock at a price of $15 per share. You paid 50 cents per share in commissions for each transaction i.e. for each trade. What is the net gain of the short sale? (Show work for partial credit) O $2500 O $1500 $1200 $1150 O $1100
An investor bought 200 CYH shares at P50.00. He received cash dividends of P2.00 per share. The company also declares split dividend of 2-1. The market price after the declaration of split is P60.00. Assuming that the investor sold all his shares at the date of declaration, how much profit is realized on the sale of shares of stocks (disregard commission and other charges)?
Ratio Analysis MJO Inc. has the following stockholders equity section of the balance sheet: On the balance sheet date, MJOs stock was selling for S25 per share. Required: Assuming MJOs dividend yield is 1%, what are the dividends per common share? Assuming MJOs dividend yield is 1% and its dividend payout is 20%, what is MJOs net income?
Brower Co. is considering the following alternative financing plans: Income tax is estimated at 40% of income. Determine the earnings per share of common stock, assuming that income before bond interest and income tax is 2,000,000.
If RGD Corporation earned P1.50 per shahre last year and its stock traded at P30 per share , what should the corporation's stock trade for if it earns P2 per share this year? a. P35 b. P40 c. P50 d. P60
chuss Inc. can sell preferred shares for $82 with an estimated flotation cost of $2.00. The preferred stock is anticipated to pay $14 per share in dividends. a. Compute the cost of preferred stock for Schuss Inc. (Round the final answer to 2 decimal places.) Cost of preferred stock % b. Do we need to make a tax adjustment for the issuing firm? multiple choice Yes No
Schuss Inc. can sell preferred shares for $64 with an estimated flotation cost of $3.00. The preferred stock is anticipated to pay $5 per share in dividends. a. Compute the cost of preferred stock for Schuss Inc. (Round the final answer to 2 decimal places.) Cost of preferred stock % b. Do we need to make a tax adjustment for the issuing firm? multiple choice Yes No
An investor bought 200 CYH shares with a par value of P1.00 per share at P50.00. He received cash dividends of P2.00 per share. The company also declares split dividend of 2-1. The market price after the payment of split is P30.00. Assuming that the investor sold all his shares, how much is the capital gains on the sale of shares of stocks (disregard commission and other charges)? a. 2,400 b. 14,400 c. 12,000 d. 14,000
The market value of G's common stock was P20 per share at December 31, 2010, and P27 per share at December 31, 2011. The cost method is used to record treasury shares transactions. What account(s) should G credit in 2011 to record the sale of 3,000 shares? Group of answer choices A. Treasury Shares for P81,000 B. Treasury Shares for P60,000 and Retained Earnings for P21,000 C. Treasury Shares for P72,000 and Retained Earnings for P9,000 D. Treasury Shares for P60,000 and APIC from Treasury Share for P21,000