Katie's Interest in the equal GFH Partnership is liquidated when the KMD Partnership makes a Liquidating Distribution to Katie an Partners assume Katie's share of the Partnership Liabilities. Katie receives $12,000 in Cash, Accounts Receivable of $21,000 (Fa and Equipment worth (Fair Market Value) of $47,000. On the date of the Liquidation, the Partnership's Cash Basis Balance Sheet following: Cash (Adjusted Basis - $60,000; Fair Market Value - $60,000); Unrealized Receivable (Adjusted Basis - $-0-; Fair Mark Equipment (Adjusted Basis - $72,000; Fair Market Value - $141,000) (Total Assets: Adjusted Basis - $132,000; Fair Market Value Payable (Adjusted Basis - $24,000; Fair Market Value - $24,000); Capital Accounts: Katie Capital (Adjusted Basis - $36,000; Fai $80,000); Mae Capital (Adjusted Basis - $36,000; Fair Market Value - $80,000); Debra Capital (Adjusted Basis - $36,000; Fair M $80,000) (Total Liabilities And Equity (Capital)): Adjusted Basis - $132,000; Fair Market Value - $264,000). As a result of this Lic O No Recognized Gain or Loss. O $24,000 Ordinary Income and $20,000 Capital Gain. O $44,000 Ordinary Income and $-0- Capital Gain. $20,000 Ordinary Income and $24,000 Capital Gain.

Katie's Interest in the equal GFH Partnership is liquidated when the KMD Partnership makes a Liquidating Distribution to Katie an Partners assume Katie's share of the Partnership Liabilities. Katie receives $12,000 in Cash, Accounta Recaivable of $21,000 ifa and Equipment worth (Fair Market Value) of $47,000. On the date of the Liquidation, the Partnership's Cash Basis Balance Shee following: Cash (Adjusted Basis - $60,000; Fair Market Value - $60,000 ); Unrealized Recelvable (Adjusted Basis - $0. Fair Mar Equipment (Adjusted Basis - \$72,000; Fair Market Value - \$141,000) (Total Assets: Adjusted Basis - \$132,000; Far Market Valh Payable (Adjusted Basis - \$24,000; Fair Market Value - \$24,000); Capital Accounts: Katie Capital (Adjusted Basis - $36,000;; Fa $80,000 ); Mae Capital (Adjusted Basis - $36,000; Fair Markot Value - $80,000 ); Debra Capital (Adjusted Basis - $36,000, Fair I $80,000 ) (Total Liabilities And Equity (Capital)); Adjusted Basis - $132,000; Fair Market Value - $264,000); As a result of this Lin No Recognized Gain or Loss. $24,000 Ordinary Income and $20,000 Capital Gain. $44,000 Ordinary Income and \$-0-Capital Gain. $20,000 Ordinary Income and $24,000 Capital Gain