Karen Owns City of Richmond Bonds with a Face Value

question 48

Multiple Choice

Karen owns City of Richmond bonds with a face value of $10,000. She purchased the bonds on January 1, 2017, for $11,000. The maturity date is December 31, 2026. The annual interest rate is 4%. What is the amount of taxable interest income that Karen should report for 2017, and the adjusted basis for the bonds at the end of 2017, assuming straight-line amortization is appropriate?

• A)$0 and $11,000
• B)$0 and $10,900
• C)$100 and $11,000
• D)$100 and $10,900
• E)None of the above

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Definitions:

Tremors

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Drowsiness

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Antianxiety Drugs

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Mood Stabilizers

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