Investor owns 1,000,000 shares of stock of Corp. XYZ with a zero basis and a FMV...
Investor A owns 1,000 shares of XYZ stock. Investor A buys 10 call options on XYZ stock. Investor B also owns 1,000 shares of XYZ stock and sells 10 call options on XYZ stock. A’s basis in his shares is $20,000 and B’s basis in her shares is $12,000. Both A and B owned their shares for 5 years prior to entering into any of the option transactions. A exercises his options and B is assigned on her options. Both...
Henry owned 100 shares of XYZ Corp. stock. Henry’s adjusted basis in the stock was $20/share. On Oct. 29, 2019, when the share price of XYZ Corp. dropped to $8/share, Henry sold all 100 shares. On Nov. 1, 2019, Henry purchased 100 shares of XYZ Corp. for $7/share. What is Henry’s recognized loss on the Oct. 29 sale of his 100 shares of XYZ Corp.?
On January 1, 2019, Mills Corp. purchased a call option on shares of XYZ stock. Terms of the contract were as follows: Number of shares: 100 Strike price: $120 per share Expiration date: April 30, 2019 Total cost of the option contract: $90 Seller of the option contract: First Investment Bank On January 1, 2019, XYZ stock was trading at $120 per share. The following additional information is known: On March 31,2019, the price of XYZ stock was $140 per...
After the sale of the stock on December 2nd, 2018, your cost basis per share is closest to: a. $27.50 b. $28.16 c. $29.29 d. $50.83 e. $52.50 Use the following information from questions 6-12. In both 2018 and 2019 you expect to receive a W2 for $200,000; $65,000 will be already withheld on your W2 for federal income taxes and your income tax bracket is 32%. The short term capital gains on investments (<1 year) are taxed like income,...
After the sale of the stock on December 2nd, 2018, your cost basis per share is closest to: a. $27.50 b. $28.16 c. $29.29 d. $50.83 e. $52.50 Use the following information from questions 6-12. In both 2018 and 2019 you expect to receive a W2 for $200,000; $65,000 will be already withheld on your W2 for federal income taxes and your income tax bracket is 32%. The short term capital gains on investments (<1 year) are taxed like income,...
After the sale of the stock on December 2nd, 2018, your cost basis per share is closest to: a. $27.50 b. $28.16 c. $29.29 d. $50.83 e. $52.50 Use the following information from questions 6-12. In both 2018 and 2019 you expect to receive a W2 for $200,000; $65,000 will be already withheld on your W2 for federal income taxes and your income tax bracket is 32%. The short term capital gains on investments (<1 year) are taxed like income,...
Bosley Corporation began business on January 2, 2015. At that time, it issued 1,000,000 shares at a par value of $5 per share. The common shares sold for $8 per share. It did not issue any preferred stock. 1. Using the financial transactions template record the following transactions: (a) The initial stock sale on January 2, 2015. (b) On June 15, 2015, Bosley issued an additional 50,000 shares of common when the stock price was $11.50 per share. (c) On...
Use the following information from questions 6-12. In both 2018 and 2019 you expect to receive a W2 for $200,000; $65,000 will be already withheld on your W2 for federal income taxes and your income tax bracket is 32%. The short term capital gains on investments (<1 year) are taxed like income, long term capital gains on investments (> 1 year) are taxed at 15%, and dividends are taxed at 22%. Besides your W2 income, the only income you have...
Use the following information from questions 6-12. In both 2018 and 2019 you expect to receive a W2 for $200,000; $65,000 will be already withheld on your W2 for federal income taxes and your income tax bracket is 32%. The short term capital gains on investments (<1 year) are taxed like income, long term capital gains on investments (>-1 year) are taxed at 15%, and dividends are taxed at 22%. Besides your W2 income, the only income you have to...
7. There is a trading rule that goes: Buy the rumor, sell the news! Which of the following actions most likely violates this rule: The investor purchased shares on January 1st, 2018 The investor purchased shares on December 1st, 2018 The investor sold shares on December 2nd, 2018 This investor sold shares on January 1st, 2019 I II III I,IV I,II,III,IV Use the following information from questions 6-12. In both 2018 and 2019 you expect to receive a W2 for...