Question: 1. Partha owns a qualified annuity that cost $52000. Under the contract, when he reaches age 65, he will receive $500 per month until he dies. Partha turns 65 on June 1, 2016 and receives his first payment on June 3,2016. How much gross income will Partha report from the annuity payments in 2016?
2. Duc has been employeed by Longbow Corporation for 25 years. During that time, he bought an annuity at a cost of $50 per month ($15000 total cost). The annuity will pay him $200 per month after he reaches age 65. When Duc dies, his wife, Annika, will continue to receive the annuity until her death. Duc turns 65 in Apro; 2016 and receives 8 payments on the contract. Annika is age 60 when the annuity payment begin
a. How much gros income does, Duc have from the contract in the current year?
b. Assume that Duc dies on April 2, 2016. How does Annika account for the contract in 2026/.
c. Assume the same facts as in part b and that Annika dies on August 4, 2033. How does the executor of Annika's estate account for the contract in the year of her death?
3. Pablo wins a new automobile on a televsion game show. The car has a listed sticker price of $31500. A dealer advertises the same car for $30000. How much income does Pablo have from the receipt of the car? Explain.