Since its formation, Roof Corporation has incurred the following net Section 1231 gains and losses:

a. In year 4, Roof sold only one asset and recognized a $7,500 net Section 1231 gain.
How much of this gain is treated as capital gain, and how much is ordinary?
b. In year 5, Roof sold one asset and recognized a $9,000 net Section 1231 gain. How much of this gain is treated as capital, and how much is ordinary?

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Net Section 1231 loss Net Section 1231 galn Year 1 Year 2 Year 3 $(12,000) (14,000) Net Section 1231 loss