Yong Contributes a Machine Having an Adjusted Basis of $20,000

question 53

Multiple Choice

Yong contributes a machine having an adjusted basis of $20,000 and an FMV of $25,000 for a 10% partnership interest. Yong had taken $10,000 of depreciation prior to the contribution. The partnership has no liabilities. As a result of the contribution, Yong must recognize

• A)no gain or loss.
• B)a $5,000 Sec. 1245 gain.
• C)a $5,000 capital gain.
• D)$10,000 ordinary income.

---

Definitions:

Bargaining and Negotiation

The process of discussing and reaching a mutually acceptable agreement between two parties who have differing preferences.

Nonprofit Administrators

Individuals who manage and lead nonprofit organizations, focusing on achieving mission-driven objectives rather than profit maximization.

Administrative Performance

Evaluation of how well administrative duties, processes, and responsibilities are being executed within an organization.

Frequent Communication

Involves regular exchange of information, ideas, or thoughts, crucial for the smooth operation and success of any team or organization.