Taxable Income Items Practice Test

Dot, an employee of Acme C Corporation, is not a shareholder. Which of the following would be included in a taxpayer’s gross income?

On January 1, Smith sold land to Baker for $100,000 cash plus a note for $200,000 plus adequate interest with a $30,000 principal payment due in the second year. Smith's basis in the property was $100,000. What is the amount of the gain recognized in the second year under the installment method?