Tim Sells Land to Brad for $90,000

question 81

Multiple Choice

Tim sells land to Brad for $90,000. Tim originally purchased the land for $50,000. Brad agrees to pay Tim six annual installments of $15,000 each. In year three, Brad makes his third installment of $15,000. How much taxable gain will Tim have in year three?

• A)$5,000
• B)$6,667
• C)$13,333
• D)$15,000
• E)All the taxable gain should be recognized in year one.

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Definitions:

Obedience

The action or practice of following instructions or commands from an authority figure, often studied in social psychology.

Stereotyping

Oversimplified and widely held fixed ideas about a particular type of person or thing.

Accessibility

The ease with which information can be retrieved from memory or the availability of resources and services to people with disabilities.

Reciprocity

The exchange of resources, goods, and services among people of relatively equal status; meant to create and reinforce social ties.