Oscar and Frank Form an Equal Partnership, the O and F

question 4

Essay

Oscar and Frank form an equal partnership, the O and F Partnership. Oscar contributes land with an adjusted basis of $45,000, subject to a mortgage of $100,000, in exchange for a partnership interest worth $250,000. Frank contributes cash of $100,000 and performs services for the partnership in exchange for a partnership interest worth $250,000.
a.What is the amount of Oscar's recognized gain or loss (if any) as a result of the contribution to the partnership in exchange for the partnership interest?
b.What is Oscar's basis in his partnership interest immediately after the contribution?
c.What is the amount of Frank's recognized income or loss (if any) as a result of the receipt of the partnership interest in exchange for the cash and services?
d.What is the partnership's basis in the land received from Oscar?

---

Definitions:

Proxy Measure

An indirect measure or indicator that approximates or represents a phenomenon in the absence of a direct measure.

Correlated

Indicates a mutual relationship or connection between two or more things.

Refugee Women

Female individuals who have been forced to flee their country due to war, persecution, or natural disaster.

International Changes

Global shifts or transformations in political, economic, social, or environmental realms that affect multiple countries and their interactions.