Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

b. $4,800. c. $16,000. d. $16,800. 30. On July 1, 2016, Clark acquired a 20 percent interest in the D and D Partnership, by contributing

image text in transcribed
b. $4,800. c. $16,000. d. $16,800. 30. On July 1, 2016, Clark acquired a 20 percent interest in the D and D Partnership, by contributing a parcel of land for which his basis was $8,000. After the contribution, each oi the other two partners owned a 40 percent interest in the D and D Partnership. Upon contribution, the land contributed by Clark had a fair market value of $20,000 and was subject to a mortgage of $4,000. Liability for the mortgage was assumed by the partnership. What, if any, effect did Clark's contribution have on the basis of the partnership interests owned by the other two partners? a. none. b. the other partners' bases in their partnership interests were decreased. c. the other partners' bases in their partnership interests were increased. d. The answer depends on the character of the property in the hands of the partnership. 31. The partners of Martin, Cynthia, Lilly Partnership, that is, Martin, Cynthia, and Lilly, share profits and losses in a ratio of 4:3:1, respectively. The adjusted basis of each partner, as of December 31, 2016, was as follows: Martin, $7,200; Cynthia, $6,000; and Lilly, $2,500. During 2016, the partnership incurred an operating loss of $15,000. The loss is not reected in the basis figures above. As a result of this loss, what amount is deductiblI by Martin, Cynthia, and Lilly deduct, respectively, on their individual tax returns for 2016 a. $6,000, $4,500, and $2,500 b. $6,000, $4,500, and $4,500 c. $7,000, $5,500, and $2,500 d. $7,100, $5,400, and $2,500 e. $7,200, $5,625, and $1,875 32. The TR Partnership had an ordinary operating loss of $48,000 for 2016. The partnership had assets of $58,500 and liabilities of $15,000 at the end of the year. Before allocation of the loss, partner Ashford's one-third capital interest had an adjusted basis of $10,000 at the end of 2016. How much may Ashford deduct on his individual tax return as his share of the partnership loss in 2016? a. $14,500 b. $10,000 c. $16,000 d. $15,000 e. None of the above 33. Jim Cash, one of two equal partners, contributed business property with a basis to him of $15,000 and a fair market value of $10,000 to the partnership of which he was a a. $1,000 loss b. $1,000 gain c. $500 gain d. $6,000 loss e. None of the above

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamental Financial Accounting Concepts

Authors: Thomas P. Edmonds, Frances M. Mcnair, Philip R. Olds, Mark Edmonds, Christopher Edmonds

10th Edition

126015940X, 978-1260159400

More Books

Students also viewed these Accounting questions