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10. Raul owns 1,000 shares of stock in Mountain Corporation, worth $50 per share. The 2,000 shares were purchased in 2004 for $10 per share.

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10. Raul owns 1,000 shares of stock in Mountain Corporation, worth $50 per share. The 2,000 shares were purchased in 2004 for $10 per share. In 2013, the corporation issues a 10% stock dividend to all common shareholders with an option of receiving either the stock worth $10,000 or $12,000 cash. Raul selects the stock. Raul's gross income from the above is: a. $0. b. $10,000. c. $12,000. d. Raul can elect to recognize income of $12,000 or reduce his basis in the stock by $10,000. e. None of the above

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