1. Paul Penn, a cash basis taxpayer, received two tickets to "I Feel Good!", the smash-hit musical, in exchange for bookkeeping services he provided to a friend. Paul should report the fair market value of the tickets as income. True or false

2. Greg Greystone rents an apartment to Brad Berry. If Brad pays any of Greg's expenses, Greg must include the payments in his rental income. Greg may deduct the expenses paid by Brad if they are otherwise deductible. True or false

3. Tim Thayer, a lessee of part of an office building from an unrelated lessor, made permanent improvements which had a useful life longer than the remaining term of the lease. The improvements are not recovery property. Tim may amortize the cost of the improvement over the remaining term of the lease. True or false

4. In 2020, Ms. Clara, a teacher, received a cash award of $25,000 from the Chamber of Commerce in recognition of her past accomplishments in the field of education. She was chosen without action on her part and is not expected to perform any future services. The $25,000 award is the same as any other prize and must be reported by Ms. Clara as income in 2020. True or false

5. Todd, a politician, uses political contributions to pay his household electric bill. The amount used to pay the electric bill is taxable income to Todd. True or false