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NEW QUESTION: 1
Allen owns 100 shares of Prime Corp., a publicly-traded company, which Allen purchased on January
1, 2001, for $10,000. On January 1, 2003, Prime declared a 2-for-1 stock split when the fair market value (FMV) of the stock was $120 per share. Immediately following the split, the FMV of Prime stock was $62 per share. On February 1, 2003, Allen had his broker specifically sell the 100 shares of Prime stock received in the split when the FMV of the stock was $65 per share. What amount should Allen recognize as long-term capital gain income on his Form 1040, U.S. Individual Income Tax Return, for
2003?
A. $2,000
B. $300
C. $1,500
D. $750
Answer: C
Explanation:
Explanation
Choice "c" is correct. The receipt of a nontaxable stock dividend will require the shareholder to spread the basis of his original shares over both the original shares and the new shares received, resulting in the same total basis but a lower basis per share of stock helD. Therefore, Allen's total basis remains the same, $10,000, but is now split between 200 shares (a 2-for-1 split and he originally owned 100 shares).
Therefore, his basis per share goes from $100/share ($10,000/100) to $50/share ($10,000/200).
Consequently, his basis in the 100 shares sold is 100 x $50 = $5,000. Calculate his gain as follows:

Choices "a", "b", and "d" are incorrect.

NEW QUESTION: 2
What does the requirements based testing (RBT) process do? (Choose two.)
A. design a necessary and sufficient set of test cases from requirements
B. validate that the requirements are correct, complete, and unambiguous
C. ensure automatic generation of test scripts from requirement
D. help define the quality objectives, and entry and exit criteria of the test plan
Answer: A,B

NEW QUESTION: 3
Which two statements are true regarding absence qualification plans?
A. They calculate entitlement usages when an absence is recorded.
B. They determine entitlements that employees are eligible for.
C. They perform enrollments automatically during hiring.
D. Employees are enrolled into plans when the Update Accrual Plan Enrollments process is run.
Answer: A,B

NEW QUESTION: 4
Refer to the exhibit.

CE1 is the gateway router into the provider network via PE1. A network operator must inject a default route into OSPF area 0. All devices inside area 0 must be able to reach PE1. Which configuration achieves this goal?

A. Option B
B. Option A
C. Option D
D. Option C
Answer: D
Explanation:
Reference:
https://www.cisco.com/c/en/us/support/docs/ip/open-shortest-path-first-ospf/47868-ospfdb9.html

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