The Sealey Farm had a very good day in September 2014. The 10,000 foot deep well in the back 40 hit oil. The family had paid $20,000,000 for the property with $200,000 allocable to sheds, fences and other improvements. They estimate that the land was worth $10,200,000, but they paid more because they also received the mineral rights The oil company working the land estimated that there were 1 million barrels of extractable oil in the field, all of which was under Armstrong land. During 2017 the Sealeys received the following from the oil company that was working their land Gross oil and gas royalties (4,000 barrels) Minus Oil and gas wellhead taxes Net cash $265,000 0 9,200 $355,800 Calculate the Sealey family net income for federal income tax purposes from the royalties. No depreciation on the sheds, fences, etc. is allocable to this source