Required: Briefly explain whether these amounts ($500,000, the $3 per album that Lily received prior to the agreement with the third party, and the $300,000) are assessable income (4 marks).

Lily is a famous person who is in the business of being a professional singer, and has had many successful past albums. Lily enters into a new agreement with a music company to transfer copyright to them in her new album, for which she will be given a lump sum of $500,000 and a payment of $3 per album sold. After 6 months of receiving the payment of $3 per album, she enters into another agreement with a third party. Under the agreement, Lily is entitled to a lump sum of $300,000 in exchange for Lily assigning the rights to future payments of $3 per album for the next year. After the year is over, she would again be entitled to such payments.