Problem:
Lisa and John are in the business of breeding beavers to produce fur for sale. They recently purchased a pair of breeding beavers for $30,000 from XUN, Inc., and agreed to pay interest at 10% each year for five years. After the five-year period, they could pay the debt by delivering seven beavers to XUN, Inc., provided that each beaver was at least nine months old.
Identify the tax issues involved in this situation.