Lake Corp., an accrual-basis calendar-year corporation, had the following 2006 receipts:
|
2007 advanced rental payments where the lease ends in 2008 |
$125,000 |
|
Lease cancellation payment from a five-year lease tenant |
50,000 |
Lake had no restrictions on the use of the advanced rental payments and renders no services. What amount of income should Lake report on its 2006 tax return?
- $0
- $ 50,000
- $125,000
- $175,000