Ashley sells her interest in Judd Enterprises, LLC (a partnership selling movies and music) to Wynona (they are unrelated). At the time of the sale, Judd had the following balance sheet:

                                                           AB                              FMV
Cash                                                   $300,000                    $300,000
Accounts Receivable                         $0                               $200,000
Inventory                                           $200,000                    $500,000
Land                                                   $200,000                    $500,000
Total                                                  $700,000                    $1,500,000

Debt                                                   $300,000                    $300,000
Capital, Naomi                                 $200,000                    $600,000
Capital, Ashley                                  $200,000                    $600,000
Total                                                  $700,000                    $1,500,000


The sales price is $800,000. Ashley's basis in her partnership interest is $350,000.
a. What are the tax consequences to Ashley?  350,000 gain

b. What basis will Wynona take in her partnership interest?
c. If a 754 election is in place, what will the balance sheet look like after the transaction?