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25 September, 10:22

Winkler, a CPA, provided accounting services to a client, Thompson. On December 15 of the same year, Thompson gave Winkler 100 shares of Foster Corp. as compensation for services. The adjusted basis of the stock was $4,000, and its fair market value at the time of transfer was $5,000. The following year, Winkler sold the stock on February 15 for $7,500. What is the amount that Winkler should recognize as gain on the sale of stock?

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  1. 25 September, 10:32
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    the bonds will recognize a gain for 3,500

    Explanation:

    The adjusted basis of the stock will be the value in Winkler books.

    So selling at 7,500 will recognize gain for 3,500
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