Andrew, an individual began business four years ago and has never sold a 1231 asset. Andrew owned each of the assets for several years. In the current year, Andrew sold the following assets:

Asset	original cost	Accumulated depreciation	gain/loss
Machinery	$12000	$7000	$6000
Furniture	10000	2000	3000
Building	90000	20000	(5000)

Assuming Andrew's marginal income tax rate is 30% what is the character of the gains and losses and what effect do they have on Andrew's tax liability?