Alberta and Archie (wife and husband) had water damage in their home during 2004 which ruined the furniture in their basement. The following items were completely destroyed and not salvageable.

Their homeowner’s insurance policy had a $10,000 deductible for the personal property, which was deducted from their insurance reimbursement of $12,700. Their adjusted gross income for 2004 was $30,000. What is the amount of casualty loss that Alberta and Archie can claim on their joint return for 2004?

A. $10,600

B. $3,400

C. $6,900

D. $0