QUESTION 4 Larry purchased an annuity from an insurance company that promises to pay him $1,500 per month for the rest of his We Larry paid 5176,076 for the annuity Larry is in good health, and he is 72 years old. Larry received the first annuity payment of $1,500 this month. Use the expected number of payments in Exhibit 5-1 for this problem How much of the first payment should Larry include in gross income? QUESTION 7 Jimmy has fallen on hard times recently. Last year he borrowed $250,000 and added an additional $50,000 of his own funds to purchase $300,000 of undeveloped real estate. This year the value of the real estate dropped dramatically and Jimmy's lender agreed to reduce the loan amount to $230,000. The real estate is worth $200,000 and Jimmy has $43,000 in other assets but no other liabilities What is the amount Jimmy must include in gross income