1.Ariel's grandmother, Mariam, gave her a diamond ring as a gift, which Mariam's husband had given her at the birth of their first child. The original cost of the ring was $3,000. At the time Ariel received the ring, the fair market value was $4,000. What is Ariel's basis for the ring?

$0

$1,000

$3,000

$4,000

2.Which of the following is a capital asset?

Copyrights.

Depreciable property used in a trade or business.

Inventory held mainly for sale to customers in a taxpayer's trade or business.

Land, purchased and held for potential increase in value

3.Which of the following is used to calculate the tax due when a taxpayer's only investment income is from capital gain distributions from a mutual fund?

Alternative Minimum Tax Worksheet.

Estimated Tax Worksheet.

Qualified Dividends and Capital Gain Tax Worksheet.

Schedule D Tax Worksheet.

4.Kamani received Form 1099-DIV, Dividends and Distributions, shown below. Where on Kamani's Form 1040 should this income be reported? (All of Kamani's other income was from wages.) Answer choices are below the image.

$196 on line 2a, $381 on line 2b, and $450 on line 7.

$196 on line 3a, $381 on line 3b, and $450 on line 7.

$196 on line 3a, $185 on line 3b, and $450 on line 8.

$381 on line 3a, $196 on line 3b, and $450 on line 8.