Exercise 1722 (Algorithmic) (LO. 2) Several years ago Nicolas, a timber dealer, purchased a tract of land with a substantial stand of trees on it. The land cost $21,650, and the timber cost $461,000. On the first day of 2021 , the timber was appraised at $599,300, in August 2021, Nicolas cut the timber and sold it for $659,230. Nicolas clects to treat the cutting as a sale or exchange under 1231. As a result, Nicolas has a 4 $1231 gain and \$\$ of ordinary income