LO7 In 2007, Patricia purchases a rental property as an investment at a cost of

$60,000. From 2007 through 2010, she takes $7,000 in depreciation on the property.

In 2010, Patricia sells the rental property for $80,000, payable at $20,000 per year for 4 years with interest on the unpaid balance at 10%. How much income or loss must Patricia recognize in 2010?

Assume that in addition to the sale of the rental property, Patricia sells other capital assets that result in a loss of $28,000. What would you recommend that Patricia do regarding the gain on the sale of the rental property?