Under the Original Issue Discount (OID) Rules as Applied to a Three-Year

question 71

Multiple Choice

Under the original issue discount (OID) rules as applied to a three-year certificate of deposit:

• A)All of the income must be recognized in the year of maturity by a cash basis taxpayer.
• B)The OID will be included in gross income for the year of purchase.
• C)The interest income will be the same each year.
• D)The interest income will be greater in the third year than in the first year.
• E)None of these is correct.

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Definitions:

Neural Plate

Region of the dorsal surface of the embryo that is transformed into the neural tube and neural crest.

Primitive Streak

An early structure that forms in the developing embryo, crucial for the process of gastrulation and establishing the body plan of the organism.

Notochord

Small rod of tissue lying ventral to the neural tube. A characteristic of all vertebrates, in humans it becomes the nucleus pulposus of the intervertebral disks.

Somites

Blocks of mesodermal cells located on either side of the neural tube in the developing embryo, which will differentiate into the vertebrae, rib cage, and associated musculature.