Interest in capital and profits and losses

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Farmer contributed land to an LLC in exchange for a 34% interest in capital and profits and losses. Farmer’s basis in the property was $300,000 and its fair market value was $540,000. Contractor contributed his services and the use of his equipment for a 33% interest in profits and losses. Developer contributed $500,000 cash for a 33% interest in capital, profits and losses. The $500,000 was spent on development and selling expenses. After development was completed they sold the property for $1,800,000. Allocate the profits.

Reference no: EM13753427

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