(5 points) Holly and Marcus formed an equal partnership. Holly contributed land with an A/B of $20,000 and a FMV of $120,000. Marcus contributed cash of $120,000. Three years after the contribution date, the land contributed by Holly is sold by the partnership to an unrelated third party for $140,000.

What bases do the parties have in their partnership interests at the date of formation?

How will the gain from the sale of the land be allocated between Marcus and Holly? How will this be reflected in their bases in the partnership?