Vanessa bought shares in Daugh Mutual Fund in 2018 for $120 a share. In 2019, she received a non-dividend distribution of $50 a share. She reduced her basis in each share by $50 to an adjusted basis of $70. In 2020, Vanessa received a non-dividend distribution of $10 per share and further reduced her basis in each share to $60. In 2021, she received a non-dividend distribution of $20 per share. Vanessa's basis was reduced to $40. In 2022, the non-dividend distribution from the mutual fund was $50 a share. Which of the following is true regarding Vanessa's basis and gain in the stock? A. Vanessa reduces her basis in each share to zero and reports $10 of gain B. Vanessa reduces her basis in each share to zero and reports $40 of gain C. Vanessa reduces her basis in each share to zero and reports $50 of gain D. Vanessa reduces her basis in each share to zero and reports $120 of gain
Vanessa bought shares in Daugh Mutual Fund in 2018 for $120 a share. In 2019, she received a non-dividend distribution of $50 a share. She reduced her basis in each share by $50 to an adjusted basis of $70. In 2020, Vanessa received a non-dividend distribution of $10 per share and further reduced her basis in each share to $60. In 2021, she received a non-dividend distribution of $20 per share. Vanessa's basis was reduced to $40. In 2022, the non-dividend distribution from the mutual fund was $50 a share. Which of the following is true regarding Vanessa's basis and gain in the stock? A. Vanessa reduces her basis in each share to zero and reports $10 of gain B. Vanessa reduces her basis in each share to zero and reports $40 of gain C. Vanessa reduces her basis in each share to zero and reports $50 of gain D. Vanessa reduces her basis in each share to zero and reports $120 of gain
Chapter5: Gross Income: Exclusions
Section: Chapter Questions
Problem 50P
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Q4.
Transcribed Image Text:Vanessa bought shares in Daugh Mutual Fund
in 2018 for $120 a share. In 2019, she received
a non-dividend distribution of $50 a share.
She reduced her basis in each share by $50 to
an adjusted basis of $70. In 2020, Vanessa
received a non-dividend distribution of $10
per share and further reduced her basis in
each share to $60. In 2021, she received a
non-dividend distribution of $20 per share.
Vanessa's basis was reduced to $40. In 2022,
the non-dividend distribution from the mutual
fund was $50 a share. Which of the following
is true regarding Vanessa's basis and gain in
the stock?
A. Vanessa reduces her basis in each share to
zero and reports $10 of gain
B. Vanessa reduces her basis in each share to
zero and reports $40 of gain
C. Vanessa reduces her basis in each share to
zero and reports $50 of gain
D. Vanessa reduces her basis in each share to
zero and reports $120 of gain
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ISBN:
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Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT