11.10 The balance sheet of Partnership ABC (expanded to show asset values) is as follows: Cash Receivables I n v e n t o r y Equipment P l a n t Land To t a l A s s e t s Assets Liabilities Tax Book FMV Tax Book $ 75,000 $ 750,0 $ 75,000 Debt $ 7 2 , 0 0 0 | $ 7 2 0, 0 0 27,000 270,0 27,000| 21,000 21,000 33,000 Capital 45,000 45,000 42,000 |Albert 62,000 62,000 55,000 55,000 65,000 | Bethany 62,000 62,000 35,000 35,000 55,000 | Charlize 62,000 62,000 Total Liabilities $258,000 $258,000 $297,000 and Capital $258,000 $258,000 Partnership ABC is a general partnership which uses an accrual method and has made no section 754 election. Its plant is real property which it has depreciated on a straight-line basis. The partnership distributes to Bethany in liquidation of her interest the land and receivables valued at $20,000. How much ordinary income and capital gain or loss do Bethany and the partnership recognize on this distribution, applying the proposed regulations under section 751(b)? a) Bethany, $0 income, $0 gain; ABC, $0 income b) Bethany, $0 income, $0 gain; ABC, $4,000 income c) Bethany