A Worthless Security Had a Holding Period of 6 Months

question 64

Multiple Choice

A worthless security had a holding period of 6 months when it became worthless on December 10,2016.The investor who had owned the security had a basis of $20,000 for it.Which of the following statements is correct?

• A)The investor has a long-term capital loss of $20,000.
• B)The investor has a short-term capital loss of $20,000.
• C)The investor has a nondeductible loss of $20,000.
• D)The investor has a short-term capital gain of $20,000.
• E)None of the above.

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Definitions:

Solo Status

A sense that one is unique in some specific manner in relation to other people in the currentenvironment

Self-sufficient

means being able to fulfill one's needs without external assistance, showing independence and self-reliance.

Looking-Glass Self

A social psychological concept that suggests people develop their self-image based on how they believe others perceive them.

Self-schema

A cognitive framework comprising beliefs and ideas about oneself that directs how we process self-relevant information.