At year-end, Barbara sells her 1/3 interest in the ABC Partnership to James for $220,000 cash. At the beginning of the year, the partnership had liabilities totaling $12,000. Barbara's basis in her partnership interest totaled $60,000, which included her share of partnership liabilities. The partnership has net income of $126,000 for the current year. On the date of the sale (year-end), the basis and the agreed fair market values of the partnerships assets and liabilities are as follows:

	Basis	Market Value
Cash	$ 120,000	$ 120,000
Accounts Receivable	-0-	72,000
Inventory	30,000	51,000
Land	75,000	90,000
Accounts Payable	18,000	18,000

Required:

a. Using good form, determine Barbaras recognized gain or loss from the sale and also the character of the gain or loss.

b. Assume that Barbaras basis in her partnership interest at the beginning of the year was $160,000 instead of $60,000. Given this new fact, using good form, determine Barbaras recognized gain or loss and also the character of the gain or loss.