When selling stocks, which method of calculating basis provides the greatest opportunity for minimizing gains or increasing losses?
A) Specific identification
B) FIFO
C) LIFO
D) Weighted average
E) None of the choices are correct

Question

Quizplus · Accepted Answer

Specific identification allows the seller to choose which specific shares to sell, allowing for the greatest opportunity to minimize gains or increase losses. This method allows the seller to choose shares with the highest basis (purchase price) to minimize gains or choose shares with the lowest basis to increase losses.

When Selling Stocks, Which Method of Calculating Basis Provides the Greatest