Evans Corporation Has a $15,000 Net Capital Loss in 2011

question 113

Multiple Choice

Evans Corporation has a $15,000 net capital loss in 2011.The corporation reported the following capital gain net income during the past three years.Identify which of the following statements is true.

• A)The loss is used to offset the gains from 2010 and then carried back to offset $10,000 of the gains in 2008.
• B)The loss is used to offset the $11,000 of the 2009 gains and then carried back to offset $4,000 of the year 2008 net gain.
• C)The loss is used to offset $3,000 of the current year ordinary income,all of the year 2008 capital gains,and $7,000 of the year 2009 net gain.
• D)The loss is used to offset the year 2008 net gains,then $5,000 of the year 2009 net gains.