21- At the beginning of the tax year, Zach's basis for his partnership interest and his amount at risk in the partnership was $30,000. His share of partnership items for the year consisted of tax-exempt interest income of $2,000 and an ordinary loss of $44,000. He also received a distribution of $20,000 cash from the partnership during the year. He is an active general partner and has no passive income or business losses from other sources. For the tax year, Zach will report:

a.An ordinary loss of $32,000, a suspended loss carryforward of $12,000, and a taxable distribution of $20,000.

b.A nontaxable distribution of $20,000, an ordinary loss of $12,000, and a suspended loss carryforward of $32,000.

c.A nontaxable distribution of $20,000, an ordinary loss of $10,000, and a suspended loss carryforward of $34,000.

d.An ordinary loss of $44,000 and a nontaxable distribution of $20,000.

22- Landis received $90,000 cash and a capital asset (basis of $50,000, fair market value of $60,000) in a proportionate liquidating distribution. His basis in his partnership interest was $120,000 prior to the distribution. How much gain or loss does Landis recognize, and what is his basis in the asset received?

a.$0 gain or loss; $50,000 basis.

b.$30,000 gain; $60,000 basis.

c.$0 gain or loss; $30,000 basis.

d.$20,000 gain; $50,000 basis.