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Your client, Morris Norris, was very busy this year managing his various properties and investments. He has invested a significant amount of money with a stock broker who has full control over the trades within guidelines set by Morris upon the initial funding of the brokerage account. There were over 1,000 total trades in the account and the form 1099-B summary below shows the information related to the brokerage account. Morris also had several transactions that were outside of the brokerage account. He sold some stock that he had acquired by inheritance from his grandfather 33 years ago. The sales price of the stock was $650,000 for all of the 48,000 shares of Coca Cola (ticker symbol KO) stock he sold. Your supervisors research noted that the Coke stock had split several times during the years, such that the 48,000 shares he owned before the sale were originally 1,000 shares. The discussion between your supervisor and Morris resulted in a conclusion that Morris had no idea of his grandfathers original cost basis or of the fair value of the stock at the time of the gift. The only piece of information you have is that grandpa bought the stock just before he died on June 15, 1984. Morris also sold some stock he received from his brother as a birthday present in 2015. Morriss brother has not had a good track record at picking stocks. Morris sold the stock in two separate transactions one in April 2016 and the other in August 2016. Each time, he sold half of the original number of shares. At the date of the sale in August 2016, the gross sales price of half of the shares Morris received was $7,500. The April transaction resulted in gross sales price of $35,000. Having been through this before, Morris remembered on his birthday in 2015 to ask his brother for the original cost basis of the 10,000 shares and the date of purchase. His brother was so offended by this that he has not spoken to Morris since then. Morris told your supervisor that the best he could get out of his brother was that he (the brother) purchased the shares in the companys Initial Public Offering (IPO) and that he paid $5.50 per share. Further research indicates that the IPO was completed in May 2015. Knowing that Morriss birthday is in July, your supervisor also tracked down the fair market value of the stock on his birthday as $3.50 per share. Morriss last big transaction for the year was his own investment in Sports Authority (SA). Morris purchased several hundred shares in September 2015 with a total cost of $75,000. Then in February 2016, SA announced it was going into bankruptcy to reorganize its debts. But then in May 2016, they announced they would be selling everything by the end of August 2016 and ceasing business activities.

MORRIS NORRIS
BROKER SUMMARY
			SALES PRICE	BROKER FEES	BASIS	GAIN/(LOSS)
SHORT TERM SUMMARY:
	GAINS		475,750	4,758	223,500
	LOSSES		156,500	1,565	427,550
LONG TERM SUMMARY
	GAINS		945,500	9,455	445,800
	LOSSES		221,000	2,210	594,375

Required: Calculate Morriss net gain or loss from all of these transactions and determine whether the net amount is short term or long-term. Show your calculations and explain your reasoning for each conclusion you make.