Required information [The following information applies to the questions displayed below.] Ansel purchased raw land three years ago for $140,000 to hold as an investment. After watching the value of the land drop to $105,000, he decided to contribute it to Mountainside Developers LLC in exchange for a 5 percent capital and profits interest. Mountainside plans to develop the property and will treat it as inventory, like all the other real estate it holds. b. If Mountainside sells the property for $40,000 after holding it for two years, how much gain or loss does it recognize, and what is the character of the gain or loss? $ 35,000 Capital loss Ordinary loss