Roy owns a 30% interest in the capital and profits of Bluejay company (a calendar year partnership). For tax year 2021, the partnership profits were $500,000. during the year, Roy withdrew from the partnership a total of $90000. He also invested an additional $30,000 in the partnership. For 2021, Roy's gross income from the partnership is

a. $72000

b. $90000

c. 150000

d. $162000

e. None of the above.

2. Linda, a widow, elected to receive the proceeds of a $150000 life insurance policy on the life of her deceased husband in 10 installments of $17500 each. Her husband had paid premiums of $60000 on the policy. In the first year, Linda collected $17500 from the insurance company. She must include in gross income.

a. $0

b. $2500

c. $10000

d. $25000

e. None of the above