Question
A taxpayer purchased a bond denominated in GBP for EUR112,000 when 1 EUR = $0.75. Taxpayer sells the bond for EUR125,000 when the exchange rate
A taxpayer purchased a bond denominated in GBP for EUR112,000 when 1 EUR = $0.75. Taxpayer sells the bond for EUR125,000 when the exchange rate has increased to $0.78.
What is the amount and character of taxpayer's gain/loss?
| a. | $3,360 capital gain & $10,140 ordinary income | |
| b. | $3,360 ordinary income & $10,140 capital gain | |
| c. | $3,360 ordinary income | |
| d. | $3,360 ordinary income and $13,500 capital gain |
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Loose Leaf For Financial Accounting Fundamentals
Authors: John Wild, Ken Shaw, Barbara Chiappetta
6th Edition
1260151980, 978-1260151985
