Sarah owns 100 shares of Drake, Inc. (adjusted basis of $50,000). On October 11,2010, she sells the 100 shares for their fair market value of $45,000. On November 5,2010, she purchases 125 shares of Drake stock for $57,500.
a) what is Sarah's realized and recognized gain or loss on the 100 shares sold on October 11, 2010?
b) What is Srah's adjusted basis for the 125 shares purhased on November 5,2110?
c) How would your answers in (a) and (b) change if Sarah purchased only 75 shares for $34,500 on November 5,2010?
d) How would your answers in (a) and (d) change if Sarah purchase date would you recommend?