Zayde is a 1/3 partner in the ARZ partnership with an outside basis of $156,000 on January 1.Zayde sells his partnership interest to Thomas on January 1ˢᵗ for $180,000 cash.The ARZ Partnership has the following assets and no liabilities as of January 1:
$\begin{array} { l r r r }
& \text { Basis } & \text { FMV } \
\text { Cash } & \$ 27,000 & \$ 27,000 \
\text { Accourts receivable } & - 0 - & 18,000 \
\text { Inventory } & 103,500 & 121,500 \
\text { Equipment } & 270,000 & 337,500 \
\text { Stock irvestrnent } & \underline { 67,500} & \underline { 96,000 }\
\text { Totals } & \underline { \$ 468,000 }& \underline { \$ 600,000}
\end{array}$ The equipment was purchased for $360,000 and the partnership has taken $90,000 of depreciation.The stock was purchased 3 years ago.What is the amount and character of Zayde's gain or loss on the sale of his partnership interest?

Question

Zayde is a 1/3 partner in the ARZ partnership with an outside basis of $156,000 on January 1.Zayde sells his partnership interest to Thomas on January 1ˢᵗ for $180,000 cash.The ARZ Partnership has the following assets and no liabilities as of January 1:
 $\begin{array} { l r r r } 
&  \text { Basis } & \text { FMV }  \
\text { Cash } & \$ 27,000 & \$ 27,000 \
\text { Accourts receivable } & - 0 - & 18,000 \
\text { Inventory } & 103,500 & 121,500 \
\text { Equipment } & 270,000 & 337,500 \
\text { Stock irvestrnent } & \underline { 67,500} & \underline { 96,000 }\
\text { Totals }  & \underline { \$ 468,000 }& \underline { \$ 600,000}
\end{array}$ The equipment was purchased for $360,000 and the partnership has taken $90,000 of depreciation.The stock was purchased 3 years ago.What is the amount and character of Zayde's gain or loss on the sale of his partnership interest?

Quizplus · Accepted Answer

The Answer of Zayde is a 1/3 partner in the ARZ partnership with an outside basis of $156,000 on January 1.Zayde sells his partnership interest to Thomas on January 1ˢᵗ for $180,000 cash.The ARZ Partnership has the following assets and no liabilities as of January 1:
 $\begin{array} { l r r r } 
&  \text { Basis } & \text { FMV }  \
\text { Cash } & \$ 27,000 & \$ 27,000 \
\text { Accourts receivable } & - 0 - & 18,000 \
\text { Inventory } & 103,500 & 121,500 \
\text { Equipment } & 270,000 & 337,500 \
\text { Stock irvestrnent } & \underline { 67,500} & \underline { 96,000 }\
\text { Totals }  & \underline { \$ 468,000 }& \underline { \$ 600,000}
\end{array}$ The equipment was purchased for $360,000 and the partnership has taken $90,000 of depreciation.The stock was purchased 3 years ago.What is the amount and character of Zayde's gain or loss on the sale of his partnership interest?

Zayde Is a 1/3 Partner in the ARZ Partnership with an Outside