John purchased 10 acres of land in 2000 for $20,000 and held it for investment....
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Accounting
John purchased 10 acres of land in 2000 for $20,000 and held it for investment. In 2010, the city condemned the land for the expansion of a highway. The city paid John $25,000 and he retained the rights to remove the gravel until 2018. John reported the sale of the land in 2010 using his basis in the land to determine gain or loss. John sold the gravel from the 10 acres in 2018 for $20,000.
Is the gain from the sale of the gravel reported as capital gain or ordinary income?
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