Gabby is a 1/3 partner (capital and profits) in GAB Partnership (cash basis, calendar year partnership). At the beginning of the year, Gabbys outside basis is $100,000. Since the beginning of the year, GAB has had ordinary business income of $60,000. The partnership currently has the following assets: Cash: $300,000 Unrealized receivables: FMV = $90,000 ($0 inside basis) Land: FMV = $90,000; $60,000 inside basis (purchased by GAB Partnership)

Q1. If Gabby sells her 1/3 partnership interest to George for $160,000, what is the amount of Gabbys gain or loss recognized? Enter gain as a positive number or loss as a negative number. Do not include in your answer the ordinary income that will be allocated to Gabby from the $60,000 ordinary business income, but make sure to adjust Gabby's basis before determining her gain/loss recognized.

Q2. Gabby sold her 1/3 partnership interest to George for $160,000. What amount of the gain on the sale is capital gain?