Chadwick bought 50 shares of Chipotle stock on Nov 1, 2016 for $396.33 per share. He sold the shares four years later for $778.38 per share. a) What did Chadwick pay for dl of the shares in 2016? b) What was the vdue of dl of his shares four years later? How much money did he gain/lose with this stock? d d) What is his rate of return on his shares when he sold them?

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Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.