66 Ridge Is the Manager of a Motel

66. Ridge is the manager of a motel. As a condition of his employment, Ridge is required to live in a room on the premises so that he would be there in case of emergencies. Ridge considered this a fringe benefit, since he would otherwise be required to pay $800 per month rent. The room that Ridge occupied normally rented for $70 per night, or $2,100 per month. On the average, 90% of the motel rooms were occupied. As a result of this rent-free use of a room, Ridge is required to include in gross income.

A) $0.
B) $800 per month.
C) $2,100 per month.
D) $1,890 ($2,100 × .90) .
E) None of these.