Mary incurred a $20,000 nonbusiness bad debt last year. She also had an $18,000 long-term capital gain last year. Her taxable income for last year was $25,000. During the current year, she unexpectedly collected $12,000 on the debt. Ho should Mary account for the collection? ca. $11,000 income b. $8,000 income C. $0 income od. $12,000 income Becker CPA Review 7-2 Mark and Lucy owned two stocks, Tinker, Inc. and Chance, Inc., that became worthless during year 8. The adjusted basis in Tinker was $80,000. Tinker was incorporated in year 2, and Mark and Lucy purchased their stock in year 4. Their adjusted basis in Chance was $20,000. Chance was incorporated in year 2, and Mark and Lucy were original stockholders. Both stocks were purchased for cash, and each corporation had total capital of $500,000. How much ordinary loss can Mark and Lucy deduct on their joint year 8 tax return as a result of these transactions? ca. $0 b. $20,000 C. $80,000 xod. $100,000 Feedback Check My Work Incorrect. Although $100,000 is the maximum ordinary loss allowed for $ 1244 stock, only the $20,000 of the loss on Chance qualifies under $ 1244