Mega Computer Issued Stock with a Face Value of One

question 151

Multiple Choice

Mega Computer issued stock with a face value of one cent and then sold the shares to the public for $20.00 each.Ted bought 10 shares at that price.Today,Ted sold his shares to Deirdre for $25.00 each.What are Ted's capital gains?

• A)$19.99
• B)$20.00
• C)$25.00
• D)$50.00
• E)$0.01

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Definitions:

Asset

Any resource owned or controlled by a business or an individual that is expected to produce future economic value.

Stockholders' Equity

The residual interest in the assets of a corporation after deducting its liabilities, representing ownership equity spread among stockholders.

Liabilities

Financial obligations or debts owed by a company to external parties or individuals.

Total Assets

The sum of all current and non-current assets owned by an entity, representing the total resources available for use in operations or to pay liabilities.