On February 1 of the current year, John learned that she inherited stock under her aunt’s will. John's aunt had paid $6 million for the stock 20 years ago. FMV of the stock on the date of John's aunt’s death, was $11.5 million. John sold the stock for $12 million eight months after her aunt’s death. What is John's gain on the sale of stock? a. $500,000 short-term capital gain b. $500,000 long-term capital gain c. $6,000,000 short-term capital gain d. $6,000,000 long-term capital gain
On February 1 of the current year, John learned that she inherited stock under her aunt’s will. John's aunt had paid $6 million for the stock 20 years ago. FMV of the stock on the date of John's aunt’s death, was $11.5 million. John sold the stock for $12 million eight months after her aunt’s death. What is John's gain on the sale of stock? a. $500,000 short-term capital gain b. $500,000 long-term capital gain c. $6,000,000 short-term capital gain d. $6,000,000 long-term capital gain
Chapter14: Property Transactions: Determination Of Gain Or Loss And Basis Considerations
Section: Chapter Questions
Problem 7CPA
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On February 1 of the current year, John learned that she inherited stock under her aunt’s will.
John's aunt had paid $6 million for the stock 20 years ago. FMV of the stock on the date of
John's aunt’s death, was $11.5 million. John sold the stock for $12 million eight months after
her aunt’s death. What is John's gain on the sale of stock?
a. $500,000 short-term
b. $500,000 long-term capital gain
c. $6,000,000 short-term capital gain
d. $6,000,000 long-term capital gain
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