A machine cost $$1,200,000,$ has annual depreciation of $$200,000,$ and has accumulated depreciation of $$950,000$ on December $31,2020.$ On April $1,2021,$ when the machine has a fair value of $$275,000,$ it is exchanged for a machine with a fair value of $$1,350,000$ and the proper amount of cash is paid. The exchange had commercial substance.

The gain to be recorded on the exchange is

$$150,000.$

$$25,000.$

$$0.$

$$50,000.$