Part 1. Use the provided Excel spreadsheet for the Critical Thinking assignment for this week. On Worksheet 1, Assume the there are no capital loss carryforwards in each of the independent situations presented. You are to:

1. Calculate AGI that includes the property transactions
2. Determine the amount and character (short-term or long-term) of any carryforward (if any)

Part 2. On Worksheet 2, compute the tax liability given each independent situation presented. Review Concept Summary 14.4 on page 14-26 for applicable tax rates. Also review the netting process on pages 14-21 through 14-26 of the text.

a Each scenario listed below is independent The taxpayer has W-2 income of $50,000 and sold stock purchased 6 months ago for $5,000. The shares were purchased for $500 b The taxpayer has W-2 income of $50,000 and sold stock purchased 3 years ago for $5,000. The shares were purchased for $50 c The taxpayer has W-2 income of $50,000 and sold personal residence purchased 3 years ago for $400,000. The home was purchased for $100,000 (with no other basis adjustments). d The taxpayer has W-2 income of $50,000 and sold personal residence purchased 3 years ago for $400,000. The home was purchased for $300,000 (with no other basis adjustments). e The taxpayer has W-2 income of $50,000 and sold stock purchased 3 years ago for $5,000. The shares were purchased for $5000 f The taxpayer has W-2 income of $50,000 and sold stock purchased 3 months ago for $5,000. The shares were purchased for $500 g The taxpayer has W-2 income of $50,000. The taxpayer made a loan (with a written agreement) to a friend for $2,000. The friend filed for bankruptcy and will not be repaying the loan h The taxpayer has W-2 income of $50,000. The taxpayer made a loan (with a written agreement) to a friend for $5,000. The friend filed for bankruptcy and will not be repaying the loan Part 1 Part 2