For a 30% interest in partnership capital, profits, and losses, Carol contributes a machine with a basis of $40,000 and an FMV of $80,000. The partnership assumes a $70,000 recourse liability on the machine. At the time of the contribution, the partnership had recourse liabilities of $10,000. Partners share the economic risk of loss from recourse liabilities in the same way they share partnership losses. Following the contribution, Carol has

a.   capital loss of $6,000 and a zero basis in the partnership interest.

b.   capital gain of $6,000 and a zero basis in the partnership interest.

c.   $34,000 basis in the partnership interest and no gain or loss.

 d. $43,000 basis in the partnership interest and no gain or loss.