Summit Corporation currently has a $70,000 capital loss carryforward that is due to expire at the end of 2020. During 2020, Summit sold landheld for investmentfor $750,000. Summits basis in the land was $600,000. The gain on this sale is classified as capital gain, and Summitdoes not plan to realize any additional capital gains or losses during 2020, 2021, or 2022.

Under the terms of the sale, the buyer has agreed to pay Summit $250,000in each year 2020, 2021, and 2022. Assuming Summits tax rate is 35%in all yearsand that it uses a discount rate of 9% in its tax planning decisions, decide whether Summit should elect out of using the installment method for recognizing the gain on this sale. In addition to anyclearly labeledcalculations, your answer should include a short statement explaining your conclusion.