Office Palace, Inc., leased an all-in-one printer to a new customer, Ashley, on December 27, 2015. The printer was to rent for $600 per month for a period of 36 months beginning January 1, 2016. Ashley was required to pay the first and last months rent at the time the lease was signed. Ashley was also required to pay a $1,500 damage deposit. Office Palace must recognize as income for the lease:

$7,800 in 2016, if Office Palace is a cash basis taxpayer.

$1,200 in 2015, if Office Palace is an accrual basis taxpayer.

$2,700 in 2015, if Office Palace is a cash basis taxpayer.

None of the above.

$0 in 2015, if Office Palace is an accrual basis taxpayer.