Lessons: Chapter 20 - The Law, Taxes, and Records


Important Links

Custodial accounts: Custodial Accounts 101

 


Assignments

20.1: True or False. Minors can buy stocks and mutual funds on their own through brokers

20.2: A custodial account is:

  1. A type of account controlled by investors for use in buying and selling exchange-traded funds.

  2. A type of account set up by parents so they can supervise their minors' investments into stocks, bonds, and other assets.

  3. A type of account set up for adopted minors

20.3: True or False. Kids less than 18 years old don't have to file taxes on the money they make in stocks, bonds, and mutual funds

20.4: Which of the two items below is most important when it comes to paying taxes on investments

  1. Keeping good records of each and every transaction you make related to buying or selling stocks, bonds, mutual funds, and other assets

  2. Doing dollar cost averaging 

  3. Performing fundamental analysis on your investments

20.5: True or False. Transaction cost represents brokerage fees you are charged for making investments  

20.6: Which of the following items is how to calculated capital gains:

  1. Capital Gains = Ending Value of Investment - Beginning Value of Investment

  2. Capital Gains = Ending Value of Investment - Beginning Value of Investment - Transaction Cost

20.7: True or False. Unearned income includes interest, dividends and capital gains on your investments

 

> Answers to Chapter 20 Assignments