Buying and selling shares of stocks of listed companies is a typical task to do among investors. Of course, this would result in a capital gain (or loss) when the shares are sold. This is computed as the difference between the shares' selling price and the price was originally paid to buy it. When an investor has a single share of stock, the process is easy. However, when (s)he sells multiple shares of stocks, bought over a period of time and possibly with different prices, the first step is to identify which shares of stocks are to be sold. There are two accounting principles (protocols) that are followed depends on the market of stocks: the shares bought last to be sold first, and the other is to sell the shares that stayed the longest.
Buying and selling shares of stocks of listed companies is a typical task to do among investors. Of course, this would result in a capital gain (or loss) when the shares are sold. This is computed as the difference between the shares' selling price and the price was originally paid to buy it. When an investor has a single share of stock, the process is easy. However, when (s)he sells multiple shares of stocks, bought over a period of time and possibly with different prices, the first step is to identify which shares of stocks are to be sold. There are two accounting principles (protocols) that are followed depends on the market of stocks: the shares bought last to be sold first, and the other is to sell the shares that stayed the longest.
Database System Concepts
7th Edition
ISBN:9780078022159
Author:Abraham Silberschatz Professor, Henry F. Korth, S. Sudarshan
Publisher:Abraham Silberschatz Professor, Henry F. Korth, S. Sudarshan
Chapter1: Introduction
Section: Chapter Questions
Problem 1PE
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