In 2016,Daryl sold 425 shares of Basketball Heaven Mutual Fund for $18,000.He made the following purchases of Basketball Heaven stock: 2010 275 shares @ $50 per share
2011 125 shares @ $48 per share
2012 100 shares @ $55 per share
Assuming Daryl uses the single category average cost method,he will realize:

Question

Quizplus · Accepted Answer

Using the single category average cost method, the cost basis of Daryl's 425 shares is calculated by taking the total amount paid for all the shares ($50 x 275 shares + $48 x 125 shares + $55 x 100 shares = $13,625), and dividing it by the total number of shares (275 shares + 125 shares + 100 shares = 500 shares). This gives a cost basis of $27.25 per share.

To calculate the long-term gain/loss, we need to subtract the cost basis from the selling price: 
$18,000 - ($27.25 x 425) = $6,268.75

Since the selling price is lower than the cost basis, Daryl has incurred a long-term loss of $6,268.75. Dividing by the total number of shares (500 shares) gives a per-share loss of $12.54, which is a long-term loss since Daryl held the shares for more than one year.

Therefore, the correct answer is D) $3,462.50 long-term loss.

In 2016,Daryl Sold 425 Shares of Basketball Heaven Mutual Fund