Don, the owner of Watt Inc., has a building that he bought for $2,500,000. It hasdepreciated for $350,000. Now Don wants to sell it for $4,000,000. He has heard about ordinary losses. He has heard about capital losses. Unfortunately, Don does not know the difference between these two types of losses. To add to the confusion, he doesn't know what the difference is between a realized and arecognized loss. How would you explain these concepts to Don? What type of advice would you offer to him?