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:

ABFMV

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?

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?