Pelosi Corporation Sold a Parcel of Land Valued at $300,000

Pelosi Corporation sold a parcel of land valued at $300,000.Its basis in the land was $250,000.For the land,Pelosi received $150,000 in cash in the current year and a note providing Pelosi with $150,000 in the subsequent year.What is Pelosi's recognized gain in the current and subsequent year,respectively?

A) $0,$50,000.
B) $10,000,$40,000.
C) $25,000,$25,000.
D) $50,000,$0.
E) None of thesE.The gain recognized in each year is calculated as follows;the gross profit percentage is multiplied by the amount realized in each year to determine the recognized gain.The gross profit percentage is the gain realized over the total amount realized.The $50,000 gain realized is the $300,000 amount realized ($150,000 cash plus $150,000 note) less the $250,000 adjusted basis.In the current year,the $150,000 proceeds (cash) is multiplied by the 16.67 percent gross profit percentage to determine the $25,000 gain recognized.