Determining Profit or Loss from an Investment. Three years ago, we purchased 150 shares of IBM batch for $88 the share. Today, we sole your IBM batch for $103 the share. For this problem, omit commissions which would be charged to buy as well as sell your IBM shares. What is the volume of distinction we warranted upon any share of IBM stock? What is the sum volume of distinction for your IBM investment?
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{ 2 comments… read them below or add one }
How detailed do you want to get.
Obviously your profit per share was $15.00. This will be subject to a 15% capital gains tax so you really only actually made $12.80 per share. Multiply by 150 and you’ve got $1920.00.
Now you have to figure in dividends. Right now IBM pays a $2.20 share dividend. If that was constant over the last 3 years (research required) you would have an additional $6.60 per share X 150= $990.00 total subject to regular income tax.
Gross profit $3249.00 (subject to various taxes).
It sounds like your first answer gave more info than this problem requires. If you sold for 103 and bought for 88 then you made 15 for each share. 15*150=2250. So that’s your profit. Having said that the first answer is more accurate as you would earn dividends and pay taxes. But a math book wouldn’t want to complicate all that if it’s just a basic high school or lower course.