! Required information [The following information applies to the questions displayed below.) Although Hank is retired, he is an excellent handyman and often works part time on small projects for neighbors and friends. Last week his neighbor, Mike, offered to pay Hank $860 for minor repairs to his house. Hank completed the repairs in December of this year. Hank uses the cash method of accounting and is a calendar-year taxpayer. Compute Hank's gross income for this year from each of the following alternative transactions: c. Mike bought Hank a new set of snow tires. The tires typically sell for $860, but Mike bought them on sale for $774. Gross Income ! Required information [The following information applies to the questions displayed below.) Larry purchased an annuity from an insurance company that promises to pay him $7,000 per month for the rest of his life. Larry paid $735,840 for the annuity. Larry is in good health and is 72 years old. Larry received the first annuity payment of $7,000 this month. Use the expected number of payments in Exhibit 5-1 for this problem. a. How much of the first payment should Larry include in gross income? Amount to be included in gross income