Mr. Wheeler bought a used car for $5,000 and sold it for $6,000. What is his percent of gain?

Can someone explain how to do this problem? I just don't understand.

First you have to find 5000 divided by 100 because that is the highest percent. Then you find the answer, 50, and that is 1% of 5000. Next you subtract 6000 minus 5000 equals 1000. You divide 1000 by 50 and get 20. So his percent of gain is 20%