How is the buy average of the stocks purchased is calculated at Jainam?

How is the buy average of the stocks purchased is calculated at Jainam ?

  • As per the Income Tax Act, it is mandatory to calculate profit and loss on sale of securities by using the FIFO method only.
  • Under the FIFO (First In, First Out) method, it is assumed that shares that were purchased first will be sold first from the account.

RELATED FACTS:

  • The buy average calculation of Holding does not include intraday trades.
  • If the holdings are sold and bought back on the same day then the Buy average of the holdings will remain same and the profit or loss on such a sale will be regarded as intraday profit/loss.

FOR EXAMPLE: 

Trade date

Scrip

Trade

Qty

Rate

Buy average

Calculations

25-12-2023TCSBuy40300300
27-12-2023TCSBuy20280293.33(40*300)+20*280)/40+20=17600/60=293.33
28-12-2023TCSSell30320286.67

(10*300)+(20*280)/30=8600/30=286.67

as per FIFO, 30 qty bought on 25-12 in first row.

29-12-2023TCSBuy50270200.9(10*300)+(20*280)+(50*270)/110=22100/110= 200.9