Nikki works for the Shine Company, a retailer of upscale jewelry. How much taxable income does Nikki recognize under the following scenarios?

A) Nikki buys a diamond ring from Shine Company for $12,300 (normal sales price, $16,550; Shine Company's gross profit percentage is 40 percent).

B) Nikki receives a 25 percent discount on jewelry restoration services offered by Shine Company. This year, Nikki had Shine Company repair a set of antique earrings (normal repair cost $735; discounted price $551.25).