Jane Ramos Owned Stock with a Cost of $200,000

question 42

Multiple Choice

Jane Ramos owned stock with a cost of $200,000. The stock has a market value on Jane's date of death of $375,000. The stock was willed to Jane's niece Jenny. Which of the following is true?

• A)Jenny's basis is $200,000; the stock's value in the gross estate is $100,000.
• B)Jenny's basis is $375,000; the stock's value in the gross estate is $100,000.
• C)Jenny's basis is $200,000; the stock's value in the gross estate is $375,000.
• D)Jenny's basis is $375,000; the stock's value in the gross estate is $375,000.

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Definitions:

Semiannual Interest

Interest that is calculated and paid twice a year, often used in the context of bonds or loans.

Fiscal Year

A 12-month period used for calculating annual financial statements in businesses and other organizations, which may or may not align with the calendar year.

Bond Indenture

A legal and binding agreement between a bond issuer and the bondholders specifying the terms of the bond, such as the interest rate, maturity date, and obligations of both parties.

Contract Rate

The agreed upon interest rate specified in the terms of a contract, often relating to loans or bonds.