The KLM Partnership owns the following assets on march 1 of the current year:

Asset	Partnerships Basis	FMV
Cash	$30000	$30000
Receivables	0	16000
Inventory	50000	52,000
Supplies	6000	6500
Equipment (Depreciation of $4000)	9000	10500
Land (Investment)	40000	65000
Total	$135000	$180000

Which partnership items are unrealized receivables?

Is the partnerships inventory substantially appreciated?

Assume the KLM Partnership has no liabilities and that Kays basis for her partnerships interest is $33,750. On March 1 of the current year, Kay receives a $20,000 current distribution in cash, which reduces her partnership interest from one-third to one-fourth. What are the tax results of the distribution (ie , the amount and character of any gain, loss, or income recognized and Kays basis in her partnership interest)?