In 2007, Gaylord Purchased 100 Shares of Stock of Chisel

Multiple Choice

In 2007, Gaylord purchased 100 shares of stock of Chisel Corporation for $200 per share. In 2018, Gaylord sells all of the shares for $19,000. What are the effects of these events?
I.The capital recovery concept prevents the recognition of any income.
II.Gaylord reports $1,000 of ordinary income for tax year 2018.
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A) Only statement I is correct.
B) Only statement II is correct.
C) Both statements are correct.
D) Neither statement is correct.