B, Who Is Single and 59 Years Old, Purchased a Single

question 37

Multiple Choice

B, who is single and 59 years old, purchased a single premium immediate annuity on January 1 of the current year for $12,000 that will pay him $100 every month for life beginning on January 15.Based on actuarial tables published by the IRS, his life expectancy multiple is 25.0.Assuming B lives 26 years, the amount included in his gross income for year 26 is

• A)$1,200
• B)$0
• C)$720
• D)$480