Ali owns 100 shres of Brown Corporation Stock. He purchased tehs tock at five di

Question

Ali owns 100 shres of Brown Corporation Stock. He purchased tehs tock at five different timea nd at five different prices per share as indicated.

35

4/23/02

On April 28, 2017 Ali will sell 40 shares of Brown stock for $40 a share. All of Ali's shares are held by his stockbroker. The broker's records track when the shares were purchased. May Ali designate the shares he sells? If so which shares should he sell? Assume that Ali wants to maximize his gain because he has a capital loss carryforward.

Please dont use other cheggs answers to answer this question

Share Block Number of Shares Per-Share Price Purcahse Date A 10 60 10/10/99 B 20 20 8/11/00 C 15 15 10/24/01 D

35

30

4/23/02

E 20 25 7/28/02

Explanation / Answer

Ali should sell 15 shares which he purchased on 10/24/01 , so the gain (40-15)*15 = 375

and 20 shares which he purchased on 8/11/00 , so the gain (40-20)*20 = 400

and remaining 5 shares from which he purchased on 7/28/02, so the gain (40-25)*5 = 75

so the total gain is = 375+400+75 = 850

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.