Finch, Inc., purchases 1,000 shares of Bluebird Corporation stock on October 3, 2017, for $300,000. On December

Question:

Finch, Inc., purchases 1,000 shares of Bluebird stock on October 3, 2017, for $300,000. On December 12, 2017, Finch purchases an additional 750 shares of Bluebird stock for $210,000. According to market quotations, Bluebird stock is selling for $285 per share on December 31, 2017. Finch sells 500 shares of Bluebird stock on March 1, 2018, for $162,500.
a. What is the adjusted basis of Finch's Bluebird stock on December 31, 2017?
b. What is Finch's recognized gain or loss from the sale of Bluebird stock on March 1, 2018, assuming that the shares sold are from the shares purchased on December 12, 2017?
c. What is Finch's recognized gain or loss from the sale of Bluebird stock on March 1, 2018, assuming that Finch cannot adequately identify the shares sold?
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...