Ferris Inherited State of Florida General-Purpose Bonds Worth $2,400 from His

question 41

Multiple Choice

Ferris inherited State of Florida general-purpose bonds worth $2,400 from his grandfather in 2015.He received $120 interest on the bonds in 2015,2016,and 2017.In 2017,he sells the bonds for a gain of $300.Ferris excludes the value of the bonds received and the bond interest,but must include a $300 capital gain in his 2017 gross income.Which of the following Concepts,Constructs,and/or Doctrines form the basis for this treatment?
I.Capital Recovery Concept
II.Legislative Grace Concept
III.Constructive Receipt Doctrine
IV.Realization Concept
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• A)Statements I and II are correct.
• B)Statements I and IV are correct.
• C)Statements II,III,and IV are correct.
• D)Statements I,II,and III are correct.
• E)Statements I,II,and IV are correct.

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