Brian acquired a rental house in 1987 for a cost of $80,000. Straight-line depreciation on the property of $26,000 has been claimed by Brian. In January 2010, he sells the property for $120,000, receiving $20,000 cash on March 1 and the buyer’s note for $100,000 at 10 percent interest. The note is payable at

$10,000 per year for 10 years, with the first payment to be received 1 year after the date of sale. Calculate his taxable gain under the installment method for the year of sale of the rental house.

Gain reportable in 2010