Question
Help me with the correct answer of this case. Thank you On July 1, 2018, Katrina purchased tax-exempt bonds (face value of $89,500) for $98,450.
Help me with the correct answer of this case. Thank you On July 1, 2018, Katrina purchased tax-exempt bonds (face value of $89,500) for $98,450. The bonds mature in five years, and the annual interest rate is 6%. The market rate of interest is 2%. If an amount is zero, enter "0". Determine any allocation based on months (not days). a. How much interest income and/or interest expense must Katrina report in 2018? The interest income Katrina must include in gross income in 2018 is___ The interest expense Katrina may deduct in 2018 is ___ b. What is Katrina's adjusted basis for the bonds on January 1, 2019? Katrina's adjusted basis for the bonds on January 1, 2019, is ___
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