1. Jim owns two lots of the same stock: the first lot of 100 was purchased five years ago for $2,000 and the second lot of 100 was purchased two years ago for $4,000. He wants to sell 50 shares and expects to receive $6,000. Which of the following statements concerning Jim's gain is true?
A. If Jim fails to specifically identify the shares sold; he will recognize a gain of $3,000
B. If Jim fails to specifically identify the shares sold; he will recognize a gain of $4,000
C. If Jim fails to specifically identify the shares sold; he will recognize a gain of $4,500
D. If Jim fails to specifically identify the shares sold, he will recognize a gain of $5,000
Explain in detail and also show all work.