Casualty Gains And Losses On Personal Use Property 545811

In the current year, Marcus reports the following casualty gains and losses on personal-use property. Assets X and Y are destroyed in the first casualty while Z is destroyed in a second casualty.

AssetReduction in FMVAdjusted BasisInsuranceHolding Period

X$8,000$2,000$7,0002 years
Y3,0005,0002,00010 months
Z2,5001,3001,0008 months

As a result of these losses and insurance recoveries, Marcus must report

A) a net gain of $3,700.

B) a long-term gain of $4,900 on asset X; a short-term capital loss of $900 on asset Y; and a short-term capital loss of $200 on asset Z.

C) a long-term capital gain of $5,000 on asset X; a short-term capital loss of $900 on asset Y; and a short-term capital loss of $200 on asset Z.

D) a long-term capital gain of $5,000 on asset X; a short-term capital loss of $900 on asset Y; and a short-term capital loss of $300 on asset Z.