Daisy owns a 40% interest in the DDS Partnership. Partnership assets consist of land (fair market value of $100,000, basis of $80,000), accounts receivable (fair market value of $120,000, basis of $0), and cash of $180,000. Daisy sells her interest in DDS to Chip for cash of $140,000. In addition, Chip assumes Daisys $40,000 share of the LLPs liabilities. Daisys basis in the partnership interest (including her share of the partnerships liabilities) is $120,000 immediately before the sale.

a. How much gain or loss does Daisy recognize?

b. How much ordinary income (if any) does Daisy recognize?

c. How much capital gain (if any) does Daisy recognize?

d. What is Chips basis in the partnership interest?