Adam purchased 1,000 shares of Airco Inc. common stock for $22,000 on February 3, 2013. On April 1, 2015, Adam received 100 new shares in a nontaxable stock dividend. As of April 1, the stock was trading at $25 per share. Adam sells the 100 new shares on June 15, 2015, for $2,400. Due to the stock sale, Adam will recognize a: a. $400 STCG. b. $400 LTCG. c. $2,400 STCG. d. $100 STCL.
Adam purchased 1,000 shares of Airco Inc. common stock for $22,000 on February 3, 2013. On April 1, 2015, Adam received 100 new shares in a nontaxable stock dividend. As of April 1, the stock was trading at $25 per share. Adam sells the 100 new shares on June 15, 2015, for $2,400. Due to the stock sale, Adam will recognize a: a. $400 STCG. b. $400 LTCG. c. $2,400 STCG. d. $100 STCL.
Chapter19: Deferred Compensation
Section: Chapter Questions
Problem 52P
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Transcribed Image Text:Adam purchased 1,000 shares of Airco Inc. common stock for $22,000
on February 3, 2013. On April 1, 2015, Adam received 100 new shares in
a nontaxable stock dividend. As of April 1, the stock was trading at $25
per share. Adam sells the 100 new shares on June 15, 2015, for $2,400.
Due to the stock sale, Adam will recognize a:
a. $400 STCG.
b. $400 LTCG.
c. $2,400 STCG.
d. $100 STCL.
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