Alice contributes equipment fair market value of $82,000; adjusted basis of $20,000), subject to a $14,000 liability, to form Orange Partnership, a general partnership. Mary contributes $68,000 cash. Alice and Mary share equally in partnership profits and losses. What is Alice's and Mary's basis for their partnership interests?
A) $6,000 to Alice, $68,000 to Mary.
B) $6,000 to Alice, $75,000 to Mary.
C) $13,000 to Alice, $75,000 to Mary.
D) $20,000 to Alice, $68,000 to Mary.

Question

Quizplus · Accepted Answer

The Answer of Alice contributes equipment fair market value of $82,000; adjusted basis of $20,000), subject to a $14,000 liability, to form Orange Partnership, a general partnership. Mary contributes $68,000 cash. Alice and Mary share equally in partnership profits and losses. What is Alice's and Mary's basis for their partnership interests?
A) $6,000 to Alice, $68,000 to Mary.
B) $6,000 to Alice, $75,000 to Mary.
C) $13,000 to Alice, $75,000 to Mary.
D) $20,000 to Alice, $68,000 to Mary.

Alice Contributes Equipment Fair Market Value of $82,000; Adjusted Basis