If a Stock Was Purchased in January 2014 for $1,000

question 49

Multiple Choice

If a stock was purchased in January 2014 for $1,000 and sold in December 2015 for $3,000, a ________ of $2,000 results.

• A) long-term capital gain
• B) short-term capital gain
• C) long-term capital loss
• D) short-term capital loss

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Definitions:

Invested Assets

Assets that are purchased or acquired for the purpose of generating income, capital appreciation, or other benefits to the investor.

Desired Profit

The target amount of profit a company aims to achieve in a specific period, often used in pricing and production planning.

Contribution Margin

The amount by which sales revenue exceeds variable costs, indicating how much revenue contributes towards covering fixed costs and generating profit.

Machine Time

The amount of time a machine is in operation, used to calculate manufacturing costs and efficiency in production processes.