Milton Owns a Bond (Face Value of $25,000) for Which

question 123

Multiple Choice

Milton owns a bond (face value of $25,000) for which he paid $28,000. Which of the following statements is correct?

• A) If the bond is taxable, Milton must amortize the $3,000 premium over its remaining life.
• B) The adjusted basis of the taxable bond remains at $28,000, as the amortized amount is deducted as interest.
• C) If the bond is tax-exempt, Milton can elect to amortize the $3,000 premium over the remaining life of the bond.
• D) The adjusted basis of the tax-exempt bond remains at $28,000, as the amortized amount cannot be deducted as interest.
• E) None of the above is correct.

---

Definitions:

Hutus

An ethnic group primarily associated with the Central African regions, most notably Rwanda, where they have played a significant role in the country's history and conflicts.

Genocide

Genocide is the deliberate and systematic extermination of a national, racial, political, or cultural group.

Darfur

A region in western Sudan, known for a conflict that began in the early 21st century, involving ethnic tensions and resulting in significant humanitarian issues.

Non-Arab Population

Individuals or groups who are not of Arab descent, residing within or outside the Arab world.