So let’sstart with the purchase 50,000 of stock from Blackhawk for $500, XXXXXXXXXXThestock you purchased represents 40% interest in Blackhawk. In 2010 incomestatement reported all income from...

So let’s start with the purchase 50,000 of stock from Blackhawk for $500,000.00. The stock you purchased represents 40% interest in Blackhawk. In 2010 income statement reported all income from investments of $126,000.00.In 2011 you sold your stock in Blackhawk for $575,000.00. Blackhawk didn’t pay any dividends during 2010 but reported an income of $202,500.00. I have to explain to the customer why he has a -$6000.00 on the books for his investment and not a $75000.00 gain. Please tell me why he has a loss of $6000.00