Assuming a tax rate on ordinary income of 25% and a long-term capital gain rate of 10%,
how much would you pay in taxes if you sold stock "A" for a $200 capital gain after holding it for 5 months, stock "B" for a $300 capital gain after holding it for 8 months, and stock "C" for a $500 capital gain after holding it for 14 months?
A) $250
B) $100
C) $130
D) $175
Answer: D
Explanation: D)
Short-term capital gains ($200 + $300) × 0.25 = $125
Long-term capital gains ($500 × 0.10 = $50
Total taxes due $175
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