Since in the question it is mentioned that Alice is not sure about the labor rate that used in the project budget so here the billable rate should be used as it refers to the rate that billed for the amount of work done with respect to the project. It is to be charged upon the number of hours worked
Therefore in the given situation, the correct option is third i.e. billable rates and the same is to be considered
The correct option for Harold to do after he has received the cost of the annuity is to include the entire amount of each annuity payment in gross income
As the cost of the annuity has been received by Harold and whatever he is receiving afterwards is the income. Thus he will include the complete value in the gross income and the taxes will be calculated accordingly.
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