hugo inc a calendar year taxpayer sold two operating assets this year. the first sale generated a $38,700 Section 1231 gain, and the second sale generated a $59,400 Section 1231 loss. as a resuyif these sales, Hugo should recognize:

a) $20,700 ordinary loss

b) $38,700 Section 1231 gain treated as capital gain and $59,400 ordinary loss

c) $20,700 capital loss

d) none of these choices are correct