How much tax do you owe on the capital gain

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Reference no: EM131606881

1. You purchased 100 shares of TAC for $50 per share four months ago. The brokerage fee was 4% of the total dollar amount of the purchase. Today you sold the shares for $58.50 per share. Brokerage fees were 4% of the total sale value. If you are in the 28% marginal tax bracket, how much tax do you owe on the capital gain? (Hint: since this is a short term investment [less than one year], you will use the 28% marginal tax bracket instead of the lower rate for long term capital gains and dividends.)

$5,616 owed on capital gain

$5,200 owed on capital gain

$116 owed on capital gain

$61.80 owed on capital gain

2. You purchased stock in FIS for $16 per share on January 1, 2009. Over the next year you received $1.10 per share in dividends. On December 31, 2009 you sold FIS for $22 per share. What has been your total holding period return (in percent) over the one-year period? [Hint: use the formula (dividends + selling price)/purchase price)-1]

13.23%

77.73%

105.00%

44.38%

Reference no: EM131606881

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