Question 9

Jill, a widow, elected to receive the proceeds of a $200,000 life insurance policy on the life of her deceased husband in 10 installments of $22,500 each. Her husband had paid premiums of $60,000 on the policy. In the first year, Jill collected $22,500 from the insurance company. What must she must include in gross income:

Question 10

Shaun is a student who has received an academic scholarship to State University. The scholarship paid $14,000 for tuition, $2,500 for student fees, $1,000 for books and $500 for meals. In addition, Shaun earned $6,500 to counsel freshmen on-campus living.

What amount must Shaun include in his gross income?