Comment on the following transactions.

a. Mort owns 500 shares of Pear, Inc. stock with an adjusted basis of $22,000. On July 28, 2021, he sells 100 shares for $3,000. On August 16, 2021, he purchases another 100 shares for $3,400. Explain why Mort’s realized loss of $1,400 ($3,000 − $4,400) on the July 28 sale is not recognized and his adjusted basis for the 100 shares purchased on August 16 is $4,800.

b. Explain how and why your answer in part (a) would change if Mort purchased the 100 shares on December 27, 2021, rather than on August 16, 2021.