Palace Apartments, an accrual-method taxpayer, owns and rents apartment buildings in San Francisco. On June 15, 2016, Mr. King, an individual, agreed to pay $5,000 per month for a two-year lease on a studio apartment starting July 1,2016. On June 30, 2016, Mr. King prepaid Palace Apartments $120,000, which was the entire rent for the two-year lease. How much must Palace Apartments include in income for 2016?