Luke sold a building and the land on which the building sits to his wholly owned corporation, Studemont Corp., at fair market value. The fair market value of the building was determined to be $472,500; Luke built the building several years ago at a cost of $437,500. Luke had claimed $91,500 of depreciation expense on the building. The fair market value of the land was determined to be $221,000 at the time of the sale; Luke purchased the land many years ago for $177,000. Luke's brother will use the building in his business. Required:
a. What is the amount and character of Luke's recognized gain or loss on the building?
b. What is the amount and character of Luke's recognized gain or loss on the land?

Ultravision inc. anticipates sales of $280,000 from january through april. materials will represent 50 percent of sales, and because of level production, material purchases will be equal for each month during the four months of january, february, march, and april. materials are paid for one month after the month purchased. materials purchased in december of last year were $24,000 (half of $48,000 in sales). labor costs for each of the four months are slightly different due to a provision in the labor contract in which bonuses are paid in february and april. the labor figures are: january $14,000 february 17,000 march 14,000 april 19,000 fixed overhead is $10,000 per month. prepare a schedule of cash payments for january through april. (assume the $280,000 of sales occur equally over the four months of january through april, i.e. monthly sales = $280,000 / 4.)