Frank, Greta, and Helen each have a one-third interest in the FGH Partnership. On December 31, 2018, the partnership reported the following balance sheet:

The partnership placed Asset 1 (seven-year property) in service in 2016 and Asset 2 (five-year property) in service in 2017. The partnership did not elect Sec. 179 expensing and elected out of bonus depreciation in both years. Accordingly, it computed the assets' adjusted bases at December 31, 2018 as follows:

At the end of business on December 31, 2018, Helen sold her partnership interest to Hank for $190,000. At the time of sale, the partnership had a Sec. 754 optional basis election in effect but has not elected to use the remedial method for allocating partnership items. Required: The partners have asked you to determine (1) the amount and character of Helen's gain or loss; (2) Hank's optional basis adjustment and its allocation to Asset 1 and Asset 2; and (3) the amount of depreciation allocated to Hank in 2019, including the ef-fects of the optional basis adjustment. At a minimum, you should consult the following resources:

? 1RC Secs. 743 and 751

? Reg. Sec. 1.743-1(j)

? Reg. Sec.1.755-1

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Assets: Cash Asset 1 Asset 2 Total Partners' Capital: Frank Greta Helen Total Partnership's Basis $120,000 262,380 115,200 $497,580 $165,860 165,860 165,860 $497,580 FMV $120,000 360,000 90,000 $570,000 $190,000 190,000 190,000 $570,000 Cost Depreciation: 2016 2017 2018 Adjusted basis $85,740 146,940 104,940 Asset 1 $600,000 (337,620) $262,380 $48,000 76,800 Asset 2 $240,000 (124,800) $115,200