Phi Corporation had the following capital gains and losses for 2011 through 2013:
$\begin{array} { l l l l l }
\underline{2011} & \underline{2012}&\underline{2013}\
\$ 15,000 & \$(30,000) & \$ 60,000
\end{array}$

I. Fhi can deduct a loss of $ \$ 15,000 $ in 2013 .
II. Phi will carry forward a $ \$ 15,000 $ capital loss to 2014 .
A)Only statement I is correct.
B)Only statement II is correct.
C)Both statements are correct.
D)Neither statement is correct.

Question

Phi Corporation had the following capital gains and losses for 2011 through 2013:
$\begin{array} { l l l l l } 
 \underline{2011} & \underline{2012}&\underline{2013}\
 \$ 15,000 & \$(30,000) & \$ 60,000
\end{array}$

I. Fhi can deduct a loss of $ \$ 15,000 $ in 2013 .
II. Phi will carry forward a $ \$ 15,000 $ capital loss to 2014 .
A)Only statement I is correct.
B)Only statement II is correct.
C)Both statements are correct.
D)Neither statement is correct.

Quizplus · Accepted Answer

For statement I, it is incorrect as you cannot deduct a loss from a gain in a different year. Therefore, Phi cannot deduct the loss of $15,000 in 2013. 
For statement II, it is correct as Phi can carry forward a capital loss to the following year. Therefore, Phi will carry forward a capital loss of $15,000 to 2014.

Phi Corporation Had the Following Capital Gains and Losses for 2011