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Determine whether Frank or Dorothy, Frank's friend, is taxed on the income in each of the following situations:
a. Frank owns 8% bonds with a $10,000 face value. The bonds pay interest annually on June 30. On September 30, Frank makes a bona fide gift of the bonds to Dorothy.
b. A few years ago, Frank wrote a best-selling book about computers. On August 1, he instructs the publisher to pay all future royalties to Dorothy.
c. Frank owns 1,000 shares of Pujan stock. On May 1, Pujan declares a $12-per-share dividend to shareholders of record as of June 1. On May 15, Frank gives the Pujan stock to Dorothy. She receives the $12,000 dividend on June 30.
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