This is a keratoacanthoma. These lesions have the distinctive appearance described in the question stem, and tend to occur on sun-exposed areas including the face, the forearm, and the dorsum of the hand. These lesions microscopically closely resemble squamous cell carcinoma, but are now considered benign. They may resolve spontaneously, and some authors suggest that they may not need resection. However, they are usually resected since both patient and physician often feel uncomfortable with neglecting them without having a definitive diagnosis and being absolutely certain they will spontaneously regress. Lipoma causes a soft subcutaneous mass. Malignant melanoma usually causes a pigmented lesion, often with feathery edges suggesting invasion. Pyogenic granuloma causes a red mass, often at a site of previous injury.  Seborrheic keratosis causes a warty lesion most often found on the temple or trunk.