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In 2018, Angel purchased 260 shares of Flowers R Us stock at a cost of $10,600 as an investment. In 2023, when the fair market value was $12,400, Angel gave the stock to a relative, Alex. Assuming no gift tax was paid, if the stock sells for $14,000, Alex will recognize: Multiple Choice no gain or loss. $1,600 gain. $1,800 gain. $3,400 gain.

In 2018, Angel purchased 260 shares of Flowers R Us stock at a cost of $10,600 as an investment. In 2023, when the fair market value was $12,400, Angel gave the stock to a relative, Alex. Assuming no gift tax was paid, if the stock sells for $14,000, Alex will recognize: Multiple Choice no gain or loss. $1,600 gain. $1,800 gain. $3,400 gain.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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In 2018, Angel purchased 260 shares of Flowers R Us stock at a cost of $10,600 as an investment. In 2023, when the fair market value was $12,400, Angel gave the stock to a relative, Alex. Assuming no gift tax was paid, if the stock sells for $14,000, Alex will recognize: Multiple Choice no gain or loss. $1,600 gain. $1,800 gain. $3,400 gain.
Transcribed Image Text:In 2018, Angel purchased 260 shares of Flowers R Us stock at a cost of $10,600 as an investment. In 2023, when the fair market value was $12,400, Angel gave the stock to a relative, Alex. Assuming no gift tax was paid, if the stock sells for $14,000, Alex will recognize: Multiple Choice no gain or loss. $1,600 gain. $1,800 gain. $3,400 gain.
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