Dahlia is in the 28 percent tax rate bracket and has purchased the following shares of Microsoft common stock over the years Microsoft common stock Date Purchased Shares Basis 7 10 2003 400 $12,000 4 20 2004 300 $10,750 1 29 2005 500 $12,230 11 02 2007 250 $7,300 If Dahlia sells 800 shares of Micro...

a Under the FIFO method the first 400 shares sold have a 12000 basis the next 300 have a 10750 basis ...

Dahlia is in the 28 percent tax rate bracket and has purchased the following shares of Microsoft

Question:

Dahlia is in the 28 percent tax rate bracket and has purchased the following shares of Microsoft over the years:
Microsoft Purchased ________________Shares _________________Basis
7/10/2003.............................. 400 ........................$12,000
4/20/2004.............................. 300 ........................$10,750
1/29/2005.............................. 500 ........................$12,230
11/02/2007............................ 250 ........................$7,300
If Dahlia sells 800 shares of Microsoft for $40,000 on December 20, 2014, what is her capital gain or loss in each of the following assumptions?
a. She uses the FIFO method.
b. She uses the specific identification method and she wants to minimize her current year capital gain.
Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...