Suppose a person has purchased 500 shares of A Ltd(listed) on 10th April for Rs. 800 per share. On 15th May company issued bonus shares in the ratio of 1:1 so he got 500 shares at nil cost. Suppose on that day shares price is Rs 425 per share, ex-bonus. On 5th June he sold 1st 500 shares and on that day market price was Rs. 450 per share. And, in calculating CG on sale of shares FIFO method is used.
Now my query is what cost should be taken for calculation of capital gain on sale of 1st 500 shares (i.e 800 or other) and whether it will be short term capital gain or loss.
Thanks.
CAclubindia
