Wallace and Pedersen Have Equal Interests in the Capital and Profits

question 65

Multiple Choice

Wallace and Pedersen have equal interests in the capital and profits of the partnership of Wallace and Pedersen, but are otherwise unrelated. On August 1, 2014, Wallace sold 100 shares of Kalmia Mining Corporation to the partnership for its fair market value of $7,000. Wallace had bought the stock in 2000 at a cost of $10,000. What is Wallace's deductible loss for 2014 as a result of the sale of this stock?

• A)$0
• B)$1,500 long-term capital loss
• C)$3,000 long-term capital loss
• D)$3,000 ordinary loss
• E)None of the above

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Definitions:

Immediate Results

Outcomes that occur or are expected to occur directly following an action or intervention without delay.

Expatriate Employees

Workers who are living and working in a country other than their native country, typically for an international organization.

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Technical Skills

Refers to the specific knowledge and abilities required to perform specialized tasks.