I just wanted to post here in case other people are searching for the correct answer.
I just figured out how to handle this correctly. Question 4 should be answered YES because the property was sold. For an automatic accounting change under DCN #7. Section 6.01(2) of Rev. Proc. 2018-31 states that the eligibility rule in section 5.01(1)(d) of Rev. Proc. 2015-13 concerning the final year of trade or business does not apply to this change. It is this eligibility rule which states that the final year of the business cannot be the year of the change.
So the IRS has explicitly allowed changes under DCN #7 (and DCN #107) for cases where the business has been terminated in the year of the change.
