In the Current Year, Marcus Reports the Following Casualty Gains

question 783

Multiple Choice

In the current year, Marcus reports the following casualty gains and losses on personal- use property. Assets X and Y are destroyed in the first casualty while Z is destroyed in a second casualty.Both casualties were the result of federal disasters. As a result of these losses and insurance recoveries, Marcus must report

• A) a long- term capital gain of $5,000 on asset X; a short- term capital loss of $900 on asset Y; and a short- term capital loss of $200 on asset Z.
• B) a long- term capital gain of $5,000 on asset X; a short- term capital loss of $900 on asset Y; and a short- term capital loss of $300 on asset Z.
• C) a long- term gain of $4,900 on asset X; a short- term capital loss of $900 on asset Y; and a short- term capital loss of $200 on asset Z.
• D) a net gain of $3,700.

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Definitions:

Acceptance Effective

The point in time when an agreement to the terms of an offer is communicated by the offeree to the offeror, resulting in a legally binding contract.

Dispatched

Sent off to a destination or for a specific purpose, often used in the context of sending out goods, documents, or personnel.

Electronic Means

Utilization of digital technology or devices to perform actions or provide services.

Lease Contracts

Agreements in which one party grants another the right to use property or equipment for a specified time in exchange for payment.