please answer the question fully.

Problen 6-11 (Algorithenic) ( LO, 1) Monty loaned his frnend Ned $25,000 three years ago, Ned signed a note and made payments on the loan. Last year, when the remaining balance was $21,250, Ned fled for bankruptcy and notified Monty that he would be unable to pay the balance on the loan. Monty treated the 521,250 as a nonbusiness bod debt. Last year, before considering the tax inplications of the nonbusiness bad debt, Monty had capital gains of 56,500 and taxable income of 531,500 . During the current year, Ned paid Monty 519,125 in satisfaction of the debt. Determine Monty's tax treatment for the $19,125 received in the current year. The nontusiness bad debt of $21,250 would have been reported as a 1 be included in Monty's gross incosne thas year. rededeck * chnded My Work A nonbusiness bad debt is a debt qurelated to the taxpayer's trade or business either when at wis created or when it became worthless