In Early 2015,Conrad Corporation Discovered Their Bookkeeper Had Embezzled $30,000

question 62

Multiple Choice

In early 2015,Conrad Corporation discovered their bookkeeper had embezzled $30,000 over the last three years at a rate of approximately $10,000 per year.Conrad also suffered uninsured hurricane damage of $40,000 late in 2015 in a presidentially declared disaster area.If Conrad wants to deduct its losses at the earliest time possible,what are the amounts (before any limitations) and year(s) of its loss deduction?

• A)2015 = $70,000
• B)2014 = $30,000,2015 = $40,000
• C)2014 = $40,000,2015 = $30,000
• D)2013 = $10,000,2014 = $10,000; 2014 = $50,000

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Definitions:

EPS

Earnings per share. A firm’s earnings stated on a per-share outstanding basis. An important measure of business performance in the stock market.

Equity

Ownership interest in a company, represented by shares that entitle holders to a share of the company's profits.

Financial Leverage

The use of borrowed money to multiply financial performance in terms of ROE and EPS.

Shareholders

Individuals or entities that own shares in a corporation, giving them partial ownership and possibly a right to vote at shareholders' meetings.