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Dahlia is in the 32 percent tax rate bracket and has purchased the following shares of...

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Accounting

Dahlia is in the 32 percent tax rate bracket and has purchasedthe following shares of Microsoft common stock over the years: DatePurchased Shares Basis 7/10/2008 500 $ 20,000 4/20/2009 400 18,3201/29/2010 600 20,160 11/02/2012 350 13,720 If Dahlia sells 1,100shares of Microsoft for $66,000 on December 20, 2018, what is hercapital gain or loss in each of the following assumptions? (Do notround intermediate calculations.)

a. She uses the FIFO method.

Dahlia is in the 32 percent tax rate bracket and has purchasedthe following shares of Microsoft common stock over the years:

Date PurchasedSharesBasis
7/10/2008500$20,000
4/20/200940018,320
1/29/201060020,160
11/02/201235013,720

If Dahlia sells 1,100 shares of Microsoft for $66,000 onDecember 20, 2018, what is her capital gain or loss in each of thefollowing assumptions? (Do not round intermediatecalculations.)

b. She uses the specific identification methodand she wants to minimize her current year capital gain.


   

Answer & Explanation Solved by verified expert
3.7 Ratings (466 Votes)
She uses FIFO method Under FIFO method the first 500 shares sold shall have basis of 20000 the next 400 shall have basis of 18320 and the last 200    See Answer
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