Henry Works Part-Time on Auto Repairs and Restoration Projects

question 35

Essay

Henry works part-time on auto repairs and restoration projects. This year Henry was paid $5,400 for repairs he made to his neighbor's auto. Henry's neighbor promised to pay Henry another $2,200 in cash next year. Henry's brother borrowed $4,100 in cash in December of this year and gave him a negotiable promissory note for $4,300 due in three months with interest. Henry sold the note in January of next year for $3,500. Finally, Henry restored a car for the football coach. The coach paid him this year with a pass to next year's football games. The pass is worth $750. Compute Henry's gross income for this tax year assuming that he uses the cash basis of accounting.

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Definitions:

Eardrum

A thin membrane that separates the outer ear from the middle ear and vibrates in response to sound waves.

Bulging

The act of swelling, protruding, or sticking out beyond the usual surface level, often indicative of an underlying condition or pressure buildup.

Palpate

The technique of examining parts of the body by touch, especially for medical purposes to detect abnormal conditions.

Abdominal Pain

A discomfort or pain felt anywhere in the region between the chest and the groin.