On January 1, 2013, an investor bought 200 shares of Gottahavit, Inc., for $50 per share. On

Question:

On January 1, 2013, an investor bought 200 shares of Gottahavit, Inc., for $50 per share. On January 3, 2014, the investor sold the stock for $55 per share. The stock paid a quarterly dividend of $0.25 per share. How much (in $) did the investor earn on this investment and, assuming the investor is in the 33% tax bracket, how much will she pay in income taxes on this transaction?

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...