In 2017, Kevin purchased 5,000 shares of Purple Corporation stock at $6 per share. In 2019, he receives a 5% preferred stock dividend. At the time of the stock dividend, the common stock of Purple Corporation has a fair market value of $9 and the preferred stock has a fair market value of $12 per share.

A. What is Kevins per share basis in the Purple Corporation common stock?

1. $5.62
2. $4.50
3. $0
4. $6

B. What is Kevin's per share basis in the Purple Corporation preferred stock?

1. $0
2. $30
3. $7.5
4. $120

C. How much taxable income does Kevin have as a result of the stock dividend?

1. $0
2. $3,000
3. $1,500
4. $750