Determine the amount of the capital gain or loss in each of the following transactions and state whether the gain or loss is long-term or short-term.
A)100 shares of Bilco stock bought for $8,000 on January 22 of year 3 and sold for $10,000 on January 22 of year 4.
B)20 acres of investment land bought for $8,000 on January 31 of year 3 and sold for $7,000 on February 2 of year 4.
C)150 shares of Data stock bought for $15,000 on April 1 of year 2 and sold for $17,000 on May 28 of year 4.

Question

Quizplus · Accepted Answer

B  C  A) The capital gain is $2,000 ($10,000 - $8,000) and it is a short-term gain because the holding period is exactly one year.  B) The capital loss is $1,000 ($7,000 - $8,000) and it is a long-term loss because the holding period is more than one year.  C) The capital gain is $2,000 ($17,000 - $15,000) and it is a long-term gain because the holding period is more than one year.

Determine the Amount of the Capital Gain or Loss in Each