Sophi Finds a Chest Inscribed "Captain Hook" That Contains $500,000

question 37

Multiple Choice

Sophi finds a chest inscribed "Captain Hook" that contains $500,000 of cash while fishing off the shore around New Orleans. The US Customs and the DEA denied knowledge of the cash, so Sophi keeps it.
I.Sophi will not recognize any gross income if the chest contained jewels valued at $500,000, rather than cash at the time of discovery.
II.Recognition is necessary because this is a treasure trove and it is comprised of cash.
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• A)Only statement I is correct.
• B)Only statement II is correct.
• C)Both statements are correct.
• D)Neither statement is correct.