Bob Buttons, a cash basis calendar year taxpayer, owns and operates an apartment building. During 20X1, he received the following payments:

	Lease cancellation fee from an old tenant	$500
	Rent from a new tenant covering the period from July 1, 20X2	5,000
	Security deposit on June 30, 20X1, to be returned to the tenant if no damage has occurred	700

What is the amount of Bob's gross rental income for 20X1?

Select one:

a.

$1,750

b.

$2,450

c.

$5,500

d.

$6,200