Jeff is the beneficiary of a $$175,000$ insurance policy on the life of his mother, Linda. To date, Linda has paid premiums of $$35,000.$

What amount of gross income must be reported in each of the following cases?

a$.$Linda elects to cancel the policy and receives $$135,000,$ the cash surrender value of the policy.

b$.$ Linda dies and Jeff receives the face amount of the policy, $$175,000$

c$.$Linda dies and Jeff elects to receive $$48,750$ per year for $4$ years.