Question: Refer to the facts in problem 7. In the first year after the year of sale, TPW received payments totaling $106,900 from the purchaser. The

Refer to the facts in problem 7. In the first year after the year of sale, TPW received payments totaling $106,900 from the purchaser. The total consisted of $67,500 principal payments and $39,400 interest payments.
a. Compute TPW’s gain recognized under the installment sale method.
b. Compute TPW’s tax basis in the note at the end of the year.

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