Question

sonya owns 500 shares of roxy corp. that she bought in 2017 for $10 per share. on june 1, 2023 sonya sold all of her shares to her sister for $15 per share and then later the same day her sister sold the shares for their fair market value of $18 per share. the taxable capital gain that should be reported for each sister is:

Answer 1

Sonya's taxable capital gain is $2500, and her sister's taxable capital gain is $1500, from buying and selling shares of Roxy Corp.

Step-by-step explanation:

The question asks us to calculate the taxable capital gain for each sister after buying and selling shares of Roxy Corp.

Sonya originally bought 500 shares at $10 each and later sold them for $15 each. Sonya's capital gain would be:

• Selling price per share - Buying price per share = Capital gain per share
• $15 - $10 = $5 per share
• 500 shares * $5 capital gain per share = $2500 total capital gain

Sonya's sister bought the shares from Sonya for $15 each and sold them for $18 each. Her capital gain would be:

• $18 - $15 = $3 per share
• 500 shares * $3 capital gain per share = $1500 total capital gain

Therefore, Sonya's taxable capital gain is $2500, and her sister's taxable capital gain is $1500.