John owns 6,000 shares of KLM stock, 2,000 shares of BBT Mutual fund, and 10,000
ID: 2581567 • Letter: J
Question
John owns 6,000 shares of KLM stock, 2,000 shares of BBT Mutual
fund, and 10,000 shares of Centex Corporation. Her 1099-DIV forms
from these investments showed the following:
KLM: $3 per share distribution all reinvested in KLM
BBT Mutual fund: $5 per share distribution, $1 of which
represents a capital gain distribution; none of this is reinvested.
Centex: $2 per share distribution, all of which represents a return
of capital.
How much must John include in his income in the current year?
a. $40,000
b. $28,000
c. $48,000
d. $19,000
Explanation / Answer
How much must John include in his income in the current year?
a. $40,000
b. $28,000
c. $48,000
d. $19,000
[KLM stock (6,000 x $3)
+
BBT Mutual fund (2,000 x $5)]
Ans B 28000[KLM stock (6,000 x $3)
+
BBT Mutual fund (2,000 x $5)]
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