Reference no: EM131202181
1. On January 1, 2015, Carl, Hank, and Laurie formed a three-person equal partnership with Carl and Hank each contributing $100,000 and Laurie contributing investment property (land) with a basis to her of $60,000 and a fair market value of $90,000. On September 30, 2015, the partnership sold the land for $30,000. The amount of the gain or loss to be allocated to Laurie is:
a. 0.
b. $40,000 loss.
c. $30,000 loss.
d. $10,000 loss.
2. On July 1, 2015, Clark acquired a 20 percent interest in the D and D Partnership, by contributing a parcel of land for which his basis was $8,000. After the contribution, each of the other two partners owned a 40 percent interest in the D and D Partnership. Upon contribution, the land had a fair market value of $20,000 and was subject to a mortgage of $4,000. Responsibility for the mortgage was assumed by the partnership. Assuming there are no other partnership liabilities, the basis of Clark's interest in the partnership is:
a. $4,000.
b. $4,800.
c. $16,000.
d. $16,800.
Please Explain your answer
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