Question 14 (1 point) On February 1, Year 4, Cindy gifted shares of a public corporation worth $450,000 to her husband, Ken. Cindy had originally purchased the shares for $150,000. The taxpayers did not elect out of the provisions of ITA 73(1). On December 3, Year 5, Ken sold the shares for proceeds of $525,000. Which one of the following statements best describes the tax implications?

Cindy will report a capital gain of $300,000 in Year 4.

Ken will report a capital gain of $75,000 in Year 5.

Cindy will report a capital gain of $75,000 in Year 5.

Cindy will report a capital gain of $375,000 in Year 5.