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On January 1, 2022, Kunto, a cash basis taxpayer, pays $49,926 for a 24-month certificate of deposit. The certificate is priced to yield 4% (the

On January 1, 2022, Kunto, a cash basis taxpayer, pays $49,926 for a 24-month certificate of deposit. The certificate is priced to yield 4% (the effective interest rate) with interest compounded annually. No interest is paid until maturity, when Kunto receives $54,000.

Round all calculations to the nearest dollar.

a. Compute Kunto's gross income from the certificate for 2022. $

b. Compute Kunto's gross income from the certificate for 2023. $

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