Sheet1 Amount to be raised $ 15,000,000.00 stock Price $...

Question

Sheet1
        Amount to be raised    $ 15,000,000.00
        stock Price    $ XXXXXXXXXX
        Number of shares =     XXXXXXXXXX
        Share price after commission    $ XXXXXXXXXX
        Expenses =    $ 252,000.00
        Share capital raised =     XXXXXXXXXX
        Share capital after expenses    $ 15,252,000.00
        Shares to be issued =     XXXXXXXXXX/18.60
        Shares to be issued =    820000
Sheet2
Sheet3

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Sumit · Accepted Answer

6-3:
Given Data:
	Particulars
	Amount
	Number of Shares Purchased
	100
	Purchase Price per Share
	35
	Total Purchase consideration
	3500
	
	
	Taxable Income
	75000
(a). Since the shares are held by Deanna Watson for a period of less than 1 year, hence the gain on selling the shares is a short-term gain. Short-term gain is taxable at the rate at which the normal income is taxable. Since her normal taxable income is $75000, the rate of tax applicable to her is 22%. Hence the tax liability will be as under:
	Sale Consideration (100x40)
	4000
	Less: Purchase Consideration
	-3500
	
	
	Gain 
	7500
	Tax Rate 
	22%
	Tax on Gain 
	1650
(b). Since the shares are held by Deanna Watson for a period of more than 12 months, hence the gain is long-term gain.

Sheet1 Amount to be raised $ 15,000,000.00 stock Price $ XXXXXXXXXX Number of shares = XXXXXXXXXX Share price after commission $ XXXXXXXXXX Expenses = $ 252,000.00 Share capital raised = XXXXXXXXXX...

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