Rob Sells Stock with a Cost of $3,000 to His

question 117

Multiple Choice

Rob sells stock with a cost of $3,000 to his daughter for $2,200,which is its fair market value.Later the daughter sells the stock for $3,200 to an unrelated party.Which of the following describes the tax treatment to Rob and Daughter?

• A) \[\begin{array} { | l | l | }
• \hline \text { Rob } & \text { Daughter } \\
• \hline \text { Recognizes no loss } & \text { Recognizes gain of } \$ 1,000 \\
• \hline
• \end{array}\]
• B) \[\begin{array} { | l | l | }
• \hline\text { Rob } & \text { Daughter } \\
• \hline \text { Recognizes no loss } & \text { Recognizes gain of } \$ 200 \\
• \hline
• \end{array}\]
• C) \[\begin{array} { | l | l | }
• \hline\text { Rob } & \text { Daughter } \\
• \hline \text { Recognizes } \$ 800 \text { loss } & \text { Recognizes gain of } \$ 1,000 \\
• \hline
• \end{array}\]
• D) \[\begin{array} { | l | l | }
• \hline\text { Rob } & \text { Daughter } \\
• \hline \text { Recognizes } \$ 800 \text { loss } & \text { Recognizes gain of } \$ 200 \\
• \hline
• \end{array}\]

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Definitions:

Facially Expressed

Pertaining to emotions, intentions, or communications conveyed through facial movements and expressions.

Brows Drawn

A facial expression where the eyebrows are pulled together, typically indicating worry, concentration, or anger.

Basic Emotions

Fundamental feelings such as happiness, sadness, fear, disgust, surprise, and anger that are universal among humans.

Carroll Izard

An American psychologist known for his contributions to the study of emotions and their role in human development.