I:16-35 Capital Gains and Losses. First Corporation, in its fifth year of operations, realizes the following capital gains and losses in the current year:

LTCG $20,000 LTCL (8,000)

STCG 16,000 STCL (40,000)

Taxable income (exclusive of the capital gains and losses) is $60,000.

a. What is First’s net capital gain or loss?

b. What is First’s taxable income for the current year?

c. Assuming that the gains and losses reported in the current year are the first capital gains and losses ever reported by the corporation and then that the corporation had reported an excess of capital gains over capital losses in its prior tax years, explain the tax treatment of any unused capital losses