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4. Mr. MM had the following items of income and loss during the year: (10 Points) Wages $40,000 Nonbusiness bad debts (1,000) Gain or commodity
4. Mr. MM had the following items of income and loss during the year: (10 Points) Wages $40,000 Nonbusiness bad debts (1,000) Gain or commodity features held for 16months 2,000 Loss on stock held for 2 years (800) Flood damage on personal residence attributed to a federally declared disaster. ($4,500) Gain on stock held for 13 months 5,000 Required: Compute MM's taxable capital gains to be reported in MM's Income tax return. 5. Listed below are assets some of which may not be considered capital asset(s): ( 8 Points) a. Inventory held for sale in the ordinary course of business b. Machinery used in a business c. Factory building used in a manufacturing business d. Marketable securities held for investment Required: Ust those items that are capital assets and those that are not
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