An investor purchased 500 shares of common stock, $25 par, for $21,750. subsequently, 100 shares were sold for $49.50 per share. what is the amount of gain or loss on the sale?

We are tasked to determine whether there is a gain or a loss. The solution is shown below:

Cost basis: $21,750 / 500 shares = $43.5

For 100 shares, we have:

Cost basis for 100 shares = $43.5 * 100 = $4350

Perform subtraction:

Gain or Loss = Sales - Cost

Gain or loss = ($49.50 * 100 shares) - $4350

Gain or loss = $4950 - $4350

Gain or loss = $ 600

The answer is $600 (it is gain!).