Dennis sells short 475 shares of ARC stock at $112 per share on January 15, 2019. He buys 950 shares of ARC stock on April 1, 2019, at $140 per share. On May 2, 2019, Dennis closes the short sale by delivering 475 of the shares purchased on April 1. a. What are the amount and nature of the loss upon closing the short sale? Dennis has loss in the amount of $ b. When does the holding period for the remaining shares begin? The holding period for the remaining shares begins on c. If Dennis sells (at $154 per share) the remaining 475 shares on January 20, 2020, what will be the nature of his gain or loss? Dennis has in the amount of $

Dennis sells short 475 shares of ARC stock at $112 per share on January 15, 2019. He buys 950 shares of ARC stock on April 1, 2019, at $140 per share. On May 2, 2019, Dennis closes the short sale by delivering 475 of the shares purchased on April 1. a. What are the amount and nature of the loss upon closing the short sale? Dennis has loss in the amount of $ b. When does the holding period for the remaining shares begin? The holding period for the remaining shares begins on c. If Dennis sells (at $154 per share) the remaining 475 shares on January 20, 2020, what will be the nature of his gain or loss? Dennis has in the amount of $

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

On December 12, 2020, Jack contributed a painting to Kyle, LLC that was valued at $100,000 (basis of $5,000) in exchange for a 50% capital and profits interest in the LLC. Josh contributed $100,000 in cash and received a 50% interest in the LLC. On December31, Jack withdrew $50,000 in cash from the LLC and then on January 17, 2021, Josh purchased Jack's entire interest in the LLC for $50,000 and the partnership distributed the painting to Josh on February 15, 2021. What adjustments if any might the IRS make? Explain the consequences of such an adjustment to Josh & Jack and how this could have been prevented.
Stock owned by a brother is sold to his sister. The brother's adjusted basis of the stock is $22,000. He sells the stock for $19,000. The sister sells the stock to an unrelated party for $17,000. What is the gain recognized by the sister? a. Her basis is $17,000. The price she paid for it. She sold it for $19,000. She recognizes a gain of $2,000. b. Because of the situation, she only has a $1,000 recognized loss. c. She takes the brother's basis in the stock and recognizes the $1,000 gain. d. None of the answers provided are correct.
Ryan Neal bought 1,400 shares of Ford at $15.92 per share. Assume a commission of 2% of the purchase price. Ryan sells the stock for $20.23 with the same 2% commission rate. What is the gain or loss for Ryan?
John Broward owns 1,500 shares of Silver Fox Corporation common stock. John purchased the 1,500 shares on April 17, 2011, for $21,000. On December 8, 2018, John sells 750 shares for $5,000. On January 2, 2019, John buys 250 shares of Silver Fox Corporation common stock for $1,750 and 50 shares of Silver Fox Corporation preferred stock for $1,000. The preferred stock is nonvoting, nonconvertible. What is John’s realized and recognized loss on the December 8 sale of stock? What is his basis and the holding periods of the shares purchased in 2011 and in 2018? I believe I have the correct answers for question 1 but I'm not sure if I understand determining the basis for question 2. I'm not sure I understand the explanation and the example in my textbook, so, a detailed, yet simplified explanation would be very helpful.
Meman
D
Penny owns 501 shares of Mack Co. They have an adjusted cost base of $15.6 per share. On March 31, 2020, Penny sold all of her shares for $13.21 per share. After she sold the shares, the price fell further and on April 15, 2020, Penny purchased 263 of the same class of shares of Mack Co. for $10.67 per share. She was still holding all of the shares at the end of 2020. What is the adjusted cost base of the Mack Co shares Penny holds at the end of 2020?
Felix owns 40% of Unger and at January 1 2022 has a balance in its investment account of 50,000. For full year 2022 Unger has a net loss of 150,000. What is the balance of Felix's investment in Unger at Dec 31, 2022.
On July 1, 2022, Gwen purchased an XYZ September 50 Put for $450. The option expired on September 17, 2022. How should this be reported on Gwen's 2022 return? No gain or loss. $450 of capital gain. $450 of capital loss. $450 of investment expense.
On January 1, year 1, Dave received 1,000 shares of restricted stock from his employer, RRK Corporation. On that date, the stock price was $7 per share. Dave's restricted shares will vest at the end of year 2. He Intends to hold the shares until the end of year 4, when he intends to sell them to help fund the purchase of a new home. Dave predicts the share price of RRK will be $30 per share when his shares vest and will be $40 per share when he sells them. Note: Leave no answer blank. Enter zero if applicable. Input all amounts as positive values. Required: a. If Dave's stock price predictions are correct, what are the taxes due on these transactions to Dave if his ordinary marginal rate is 32 percent and his long-term capital gains rate is 15 percent? b. If Dave's stock price predictions are correct, what are the tax consequences of these transactions to RRK? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A…
This year Barney purchased 440 shares of Bell common stock for $16.50 per share. At year-end the Bell shares were only worth $3.30 per share. What amount can Barney deduct as a loss this year?
Landry owns 50 of 250 outstanding shares of Kelly Manufacturing corporation. How many of Landry’s shares must be redeemed in order for the redemption to qualify as disproportionate? Assume that Kelly Manufacturing corporation has $100,000 in current earnings & profits, has no accumulated e&p, and there were no dividends or other distributions this year. If Landry’s stock is redeemed for $15,000 on December 31, what is the effect on earnings and profits?