During the Current Year,Nancy Had the Following Transactions What Is the Amount of Her Capital Loss Deduction for l

question 51

Multiple Choice

During the current year,Nancy had the following transactions: $$\begin{array} {| l | r| } \hline \text { Short-term capital loss } & ( \$ 1,800 ) \\\hline \text { Short-term capital gain } & 3,600 \\\hline \text { Short-term capital loss carryover from last year } & ( 2,200 ) \\\hline \text { Long-term capital gain } & 7,000 \\\hline \text { Long-term capital loss } & ( 15,000 ) \\\hline\end{array}$$ What is the amount of her capital loss deduction for the current year,and what is the amount and character of her capital loss carryover?

• A) \[\begin{array} { | l | l | }
• \hline \text { Deduction } & \text { Carryover } \\
• \hline \$ 4,000 & \$ 400 \text { short-term and } \$ 5,000 \text { long- } \\
• &\text { term }\\\hline
• \end{array}\]
• B) \[\begin{array} { | l | l | }
• \hline \text { Deduction } & \text { Carryover } \\
• \hline \$ 3,000 & \$ 5,400 \text { LTCL carryover } \\
• \hline
• \end{array}\]
• C) \[\begin{array} {| l | l |}
• \hline \text { Deduction } & \text { Carryover } \\
• \hline \$ 3,000 & \$ 5,000 \text { long-term }\\\hline
• \end{array}\]
• D) \[\begin{array} { | l | l | }
• \hline \text { Deduction } & \text { Carryover } \\
• \hline \$ 12,100 & \$ 0 \\
• \hline
• \end{array}\]

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Definitions:

Apparent Authority

A situation where a third party reasonably believes an individual has the authority to act on behalf of another (such as an employer), even if that person does not have actual authority.

Ratified

An agreement or decision that has been formally approved and confirmed by the required parties.

Actual Authority

The express and implied powers given by a principal to an agent to enter into contracts or take action on the principal's behalf.

Sales Force

The division of a business responsible for selling its products or services, made up of all its salesperson.