Bob Owns 100 Shares of ACT Corporation Common Stock with a Basis

question 34

Multiple Choice

Bob owns 100 shares of ACT Corporation common stock with a basis of $3,500 and a FMV of $12,000.Bob receives 10 stock rights as a nontaxable distribution,and no basis is allocated to the stock rights.With each stock right,Bob may acquire one share of stock for $25.Bob exercises all 10 stock rights.The total basis of the newly acquired stock is

• A)$0.
• B)$250.
• C)$350.
• D)$1,200.

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Definitions:

States

Distinct political entities within a federated union or sovereign countries with defined territory and government.

Speed Dating

A matchmaking process where individuals have short conversations with potential partners to determine mutual interest.

Mutual Interest

Shared concerns, benefits, or objectives among individuals or groups that lead to cooperative efforts or relationships.

Face To Face

Face to face describes direct interaction or conversation between people, physically present in the same location.