Kate Is an Accrual Basis, Calendar-Year Taxpayer

Multiple Choice

Kate is an accrual basis, calendar-year taxpayer. On November 1, 2014, Kate leased out a building for $4,500 a month. On that day Kate received 7 months rental income on the building, a total of $31,500 ($4,500 × 7 months) . How much income must Kate include on her 2014 tax return as a result of this transaction?

A) $4,500
B) $9,000
C) $31,500
D) $54,000
E) None of the above