22. On May 1, 2010, Lane Corp. bought a parcel of land for

$100,000. Seven months later, Lane sold this land to a triple-

A rated company for $150,000, under the following terms:

25% at closing, and a first mortgage note (at the market rate of interest) for the balance. The first payment on the note, plus accrued interest, is due December 1, 2011. Lane reported this sale on the installment basis in its 2010 tax return.

In its 2010 income statement, how much gain should Lane report from the sale of this land?

a. $0

b. $12,500

c. $37,500

d. $50,000