Rayyan Kouri purchased 1000 shares in TRI Co.in 2019 for $5 per share.Due to a decline in market value Rayyan sold the shares on September 22, 2020, when they were trading for $3 per share.On October 3, 2020, Rayyan repurchased 1000 shares of Y Co.at $2.50 per share.Which of the following is true for Rayyan?
A) Rayyan can recognize a $2,000 capital loss on the sale of the shares in the 2020 tax year.
B) Rayyan can recognize a $2,000 superficial loss on the sale of the shares in the 2020 tax year.
C) The adjusted cost base of Rayyan's new shares is $4,500.
D) The adjusted cost base of Rayyan's new shares is $2,500.
Correct Answer:
Verified
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