The Tandy Partnership owns the following assets on December 31: $$\begin{array} { | l | r | c | }
\hline { \text { Assets } } & \text { Basis } & \text { Fair Market Value } \
\hline \text { Cash } & \$ 20,000 & \$ 20,000 \
\text { Unrealized receivables } & 0 & 30,000 \
\text { Inventory } & 20,000 & 25,000 \
\text { Land, Sec. } 1231 \text { property } & 35,000 & \underline { 70,000 } \
\text { Total } & \underline { \$ 75,000 } & \$ 145,000 \
\hline
\end{array}$$ Is the partnership's inventory considered to be substantially appreciated for purposes of Sec. 751? Show your work.

Question

The Tandy Partnership owns the following assets on December 31: $$\begin{array} { | l | r | c | } 
\hline  { \text { Assets } } & \text { Basis } & \text { Fair Market Value } \
\hline \text { Cash } & \$ 20,000 & \$ 20,000 \
\text { Unrealized receivables } & 0 & 30,000 \
\text { Inventory } & 20,000 & 25,000 \
\text { Land, Sec. } 1231 \text { property } & 35,000 & \underline { 70,000 } \
\text { Total } & \underline { \$ 75,000 } & \$ 145,000 \
\hline
\end{array}$$ Is the partnership's inventory considered to be substantially appreciated for purposes of Sec. 751? Show your work.

Quizplus · Accepted Answer

The Answer of The Tandy Partnership owns the following assets on December 31: $$\begin{array} { | l | r | c | } 
\hline  { \text { Assets } } & \text { Basis } & \text { Fair Market Value } \
\hline \text { Cash } & \$ 20,000 & \$ 20,000 \
\text { Unrealized receivables } & 0 & 30,000 \
\text { Inventory } & 20,000 & 25,000 \
\text { Land, Sec. } 1231 \text { property } & 35,000 & \underline { 70,000 } \
\text { Total } & \underline { \$ 75,000 } & \$ 145,000 \
\hline
\end{array}$$ Is the partnership's inventory considered to be substantially appreciated for purposes of Sec. 751? Show your work.

The Tandy Partnership Owns the Following Assets on December 31