1. Taxpayer, a corporation, is engaged in rental activity. The corporation owns three (3) properties, all of which were leased during 20X3. The transactions carried out by the corporation in 20X3 are presented below: 1. The corporation received $300,000 for rent for its three properties and incurred the following disbursements: to. Repairs $10,000 b. Salaries $25,000 c. Depreciation $10,000 d. Property taxes $5,000 2. During 20X3, a tenant vacated one of the properties. The tenant occupied the property in 20X1 and made $50,000 improvements to the property to replace the floor tile of the structure and major repairs to the electrical system. Upon termination of the tenancy in 20X3, the tenant left such improvements on the property and did not request any reimbursement. 3. The corporation negotiated an account payable with a contractor who had made several capital improvements to the property and the debt was reduced from $75,000 to $35,000. At the time of discharge, the corporation's balance sheet showed assets of $1 million and debts of $250,000. Determine the gross income of the corporation for 20X3. Select one:

a. $300,000

b.$340,000

c.$290,000

d.$250,000

2. Taxpayer, 66-year-old individual, engaged in the following activities during 20X5: 1. He received $150,000 as an inheritance from his sister who died in 20X3. 2. he Received $50,000 in pension from work after his retirement at his employment in 20X1. The cost of the pension was fully recovered. 3. He received $13,500 in federal old-age social security. Determine the individual's gross income for 20X5. Select one:

a. $200,000

b.$185,000

c.$213,500

d.$35,000