Steve Gifted Shares in a Public Corporation Which Cost $10,000

question 2

Multiple Choice

Steve gifted shares in a public corporation which cost $10,000 to his fifteen year old son, Simon. During the year, Simon received $500 in dividends. Simon then sold the shares for $12,000. Which of the following tax situations is true for Steve and Simon?

• A) Simon will have to claim the dividends and capital gain on his tax return.
• B) Simon will have to claim the dividends on his tax return and Steve will have to recognize the capital gain on his tax return.
• C) Steve will have to claim the dividends and a capital gain on his tax return.
• D) Steve will have to claim the dividends on his tax return and Simon will have to recognize the capital gain on his tax return.

---

Definitions:

Glia

Non-neuronal cells in the nervous system that support, protect, and nourish neurons.

Hemocytoblasts

Stem cells in the bone marrow from which all blood cells (red cells, white cells, and platelets) are derived.

Liver Cells

The primary cells of the liver, known as hepatocytes, responsible for various functions including detoxification, protein synthesis, and production of biochemicals necessary for digestion.

Labile Cells

Cells that are constantly dividing and have a short lifespan, such as those found in the skin and digestive tract.