On June 1, 2015, Brady purchased an option to buy 1,000 shares of General, Inc. at $40 per share. He purchased the option for $3,000. It was to remain in effect for five months. The marketexperienced a decline during the latter part of the year, so Brady decided to let the option lapse asof December 1, 2015. On his 2015 tax return, what should Brady report?A $3,000 short-term capital loss.Gold Company signs a 13-year franchise agreement with Silver. Silver retained significant powers, rights, and a continuing interest. Gold Company (the franchisee) makes noncontingent
payments of $18,000 per year for the first four years of the franchise. Gold Company also pays a contingent fee of 2% of gross sales every month. Which of the following statements is correct?
A worthless security had a holding period of 6 months when it became worthless on December 10, 2015. The investor who had owned the security had a basis of $20,000 for it. Which of the following statements is correct?