(TCO 8) Gulf Corporation elects S status effective for tax year 2014. As of January 1, 2014, Gulf's assets were appraised as follows.

Adjusted BasisFair Market ValueCash$16,010$16,010Accounts receivable--0--$55,400Inventory (FIFO)$70,000$90,000Investment in land$110,000$195,000Building$220,000$275,000Goodwill--0--$93,000

In each of the following situations, calculate any built-in gains tax, assuming that the highest corporate tax rate is 35%. C corporation taxable income would have been $100,000.

(I) During 2014, Gulf collects $48,000 of the accounts receivable and sells 80% of the inventory for $99,000.

(II) In 2015, Gulf sells the land held for investment for $203,000.

(III) In 2016, the building is sold for $270,000. (Points : 40)