Newton is a one-third owner of ProRite Partnership. Newton has decided to sell his interest in the business to Betty for $60,500 cash plus the assumption of his share of ProRites liabilities. Assume Newtons inside and outside basis in ProRite are equal. ProRite shows the following balance sheet as of the sale date:

		Tax Basis		FMV
Assets:
Cash	$	81,000		$	81,000
Receivables		46,250			46,250
Inventory		40,500			94,950
Land		42,750			28,550
Totals	$	210,500		$	250,750
Liabilities and capital:
Liabilities	$	60,000
Capital Newton		50,167
Barbara		50,166
Liz		50,167
Totals	$	210,500

What is the amount and character of Newtons recognized gain or loss?

	Amount	Character of gain or loss