Evans Corporation Has a $15,000 Net Capital Loss in 2017

question 62

Multiple Choice

Evans Corporation has a $15,000 net capital loss in 2017. The corporation reported the following cap gain netting in income during the past three years. Identify which of the following statements is true $$\begin{array} { | c | c | } \hline \text { Year } & \begin{array} { c } \text { Capital Gain } \\\text { Net Income }\end{array} \\\hline 2014 & \$ 10,000 \\2015 & 11,000 \\2016 & 5,000 \\\hline\end{array}$$

• A) The loss is used to offset the $11,000 of the 2015 gains and then carried back to offset $4,000 of the year 2014 net gain.
• B) The loss is used to offset $3,000 of 2014 , 2015 and 2016 capital gains, remaining amount carried forward at $3,000 a year until expired.
• C) The loss is used to offset the year 2014 net gains, then $5,000 of the year 2015 net gains.
• D) The loss is used to offset the gains from 2016 and then carried back to offset $10,000 of the gains in 2014.

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