Problem 11-39 (a) (LO. 6, 7, 9) The December 31 balance sheet of the Gemco LLP reads as follows. Adjusted Basis FMV Cash $215,000 $215,000 -0- 77,000 Receivables Capital assets 40,000 48,000 Total $255,000 $340,000 $63,750 $85,000 Felix, capital Fernando, capital Francesca, capital 63,750 85,000 127,500 170,000 Total $255,000 $340,000 Capital is not a material income-producing factor for the LLP. Felix is an active (general) partner and owner of a 25% interest in the LLP's profits and capital. On December 31, Felix receives a distr bution of 594,000 cash in liquidation of his partnership interest. Nothing is stated in the partnership agreement about goodwill. Felix's outside basis for the partnership interest immediately before the distribution is $63.750. a. How much is Felix s recognized gain from the distribution Capital gain: $ Ordinary income: A Capital gain: E Ordinary income: Feedback Check My Work b. How much can Gemco daim as a deduction? 28,250 Feedback Check My Work c. What on might the partnership want to take? If the election is made, the $ of additional basis is allocated to the LLP's capital assets and would reduce any future gain on sale of those assets