Carrot Corporation, a C Corporation, Has a Net Short-Term Capital

question 5

Multiple Choice

Carrot Corporation, a C corporation, has a net short-term capital gain of $65,000 and a net long-term capital loss of
$250,000 during 2019. Carrot Corporation had taxable income from other sources of $720,000. Prior years' transactions included the following: $$\begin{array} { l l r } 2015 & \text { Net long-term capital gain } & \$ 150,000 \\2016 & \text { Net short-term capital gain } & 60,000 \\2017 & \text { Net short-term capital gain } & 45,000 \\2018 & \text { Net long-term capital gain } & 35,000\end{array}$$ Compute the amount of Carrot's capital loss carryover to 2020.

• A) $0
• B) $32,000
• C) $45,000
• D) $185,000
• E) None of these.

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Definitions:

Money Markets

Financial markets where short-term debt securities are bought and sold.

Short-Term Debt Securities

Financial instruments that represent borrowed money that must be repaid within a year, such as Treasury bills and commercial papers.

Financial Markets

Platforms where buyers and sellers trade financial securities, such as stocks, bonds, currencies, and derivatives, often under regulated settings.

Long-Term Debt

represents loans and financial obligations lasting more than one year, used by businesses to finance operations, acquisitions, or investments.