Tyler has rented a house from Camarah since last year.The rent is usually $1,200 per month,but Camarah reduced the monthly rent down to $200 for all twelve months this year in exchange for Tyler putting in an inground pool in the backyard.The improvement has a fair market value of $20,000.How much total rental income must Camarah report this year?
A)$14,400
B)$12,000
C)$2,400
D)$22,400

Question

Quizplus · Accepted Answer

Camarah must report the fair market value of the improvement ($20,000) plus the actual rent received ($200 x 12 = $2,400), totaling $22,400 as rental income.

Tyler Has Rented a House from Camarah Since Last Year