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Bob purchased a zero coupon bond for $50,000 on June 30, 2019. The bond will mature in two years on (July 1, 2021) for $55,189,
Bob purchased a zero coupon bond for $50,000 on June 30, 2019. The bond will mature in two years on (July 1, 2021) for $55,189, yielding 5% before-tax interest. (Remember interest is compounded) Question 2 options: a) Bob must recognize $5,189 gross income in 2019. b) must recognize $5,189 gross income in 2021. c) must recognize $2,500 (.05 * $50,000) gross income in 2020. d) must recognize $1,250(.05 * $50,000 * .5) gross income in 2019. e) None of the above
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