In 2017, Jack purchased undeveloped oil and gas property for \($900,000\) and paid \($170,000\) for intangible drilling and development costs. He elected to expense the intangible drilling and development costs.

During the current year he sells the property for \($950,000\) when the property’s adjusted basis is \($700,000.\) Depletion of \($200,000\) was allowed on the property.

a. What is the realized gain and how much of the gain is ordinary income?

b. For Jack to have a Sec. 1231 gain, the selling price must exceed what amount?