10. Katrina received a $14,000 cash gift from her aunt Cruella. Katrina places the $14,000 in her savings account at her bank. During the year, she received $100 of interest income on the $14,000 she had deposited in the bank. Which of the following statements is true regarding these facts? 1. a. Katrina recognizes $0 gross income on the gift and $0 from the interest earned on the gift money. b. Katrina recognizes $14,000 gross income on the gift and $100 from the interest earned on the gift money. c. Katrina recognizes $0 gross income on the gift and $100 from the interest earned on the gift money. d. Katrina recognizes $14,000 gross income on the gift and $0 from the interest earned on the gift money. Congress allows self-employed taxpayers to deduct the cost of health surance above the line (for AGI) because: a. Employers are allowed to deduct Social Security (FICA) taxes as a business expense b. Self-employed taxpayers need an alternate mechanism for reducing the cost of health care c. This deduction provides a measure of equity between employees and the self-employed d. Health insurance premiums cannot be deducted otherwise e. None of the choices are correct