FormationNo Liabilities. The A-E Partnership is being formed by five individuals who each contribute assets in exchange for a 20% capital and profit/loss inter-est. Calculate the following for each partner: (1) recognized gain or loss, (2) each partners basis in his or her partnership interest, (3) the partnerships basis for each asset, and (4) the holding period of the partnership interest for the partner and the asset for the partnership. Assume all contributed assets will be used in the partner-ships trade or business.

a. A contributes business furniture with a market value of $10,000. The furniture cost $16,000 when purchased four years ago, and As adjusted basis in the furniture is $5,000.

b. B contributes business equipment with a market value of $10,000. The equipment cost $20,000 when purchased two years ago, and Bs adjusted basis in the equipment is $12,000.

c. C contributes business inventory with a market value of $10,000. The inventory cost $9,000 when purchased 16 months ago.

d. D and E contribute $10,000 cash each.