On September 1, 2020, Steve loaned Brett $2,000 at 12% interest compounded annually. Steve is not in the business of lending money. The note stated that principal and interest would be due on August 31, 2022. In 2022, Steve received $2,508.80 ($2,000 principal and $508.80 interest). Steve uses the cash method of accounting. What amount must Steve include in income on his income tax return?

Answer rating: 100% (QA)

Since Steve uses the cash method of accounting he recognizes income when he receives ca... View the full answer