Koch Realty has owned a vacant land with a FMV of $775,000 and an adjusted basis of $400,000 for more than a year.  After a lengthy negotiation Koch sells the land for $800,000.  Koch agrees to accept $50,000 at the time of the closing and $250,000 on the anniversary of the closing for the next 3 years.  (Ignore any interest – the $250k represents principal payments).

A) What is the recognized gain if Koch does not elect the installment method?

B) What is the recognized gain for the year of sale if Koch elects the installment method?