In 2016, Whiteside Catering purchased 60,000 shares of Roush Organic Foods' common stock for $945,000. On December 31, 2016, the fair value of the Roush shares was $900,000. On December 3, 2017, Whiteside sold all of their shares of Roush common stock for $17 per share less $42,000 in brokerage commissions. The realized gain on the sale of stock in 2017 that Whiteside should report is

The realized gain that Whiteside should report on sale of stock should be $33,000.

Explanation:

Whiteside bought the 60,000 shares from Roush organic foods at a price of $945,000 in 2016. On December 3, 2017 whiteside sold those 60,000 shares at $17 per share, with this they have also paid $42,000 in brokerage commissions. For taking out the gain we will subtract the purchase price of shares from selling price of share.

NOTE * (We will subtract the brokerage commission from the sales.)

Realized gain = (Sales - brokerage commission) - purchase price

NOTE * (SALES = $17 X 60,000 = $1020,000)

= ($1020,000 - $42,000) - $945,000

= $978,000 - $945,000

= $33,000