The XYZ Partnership Owns the Following Assets on December 31

question 36

Multiple Choice

The XYZ Partnership owns the following assets on December 31: $$\begin{array} { | l | r | r | } \hline & { \text { Basis } } &{ \text { FMV } } \\\hline \text { Cash } & \$ 20,000 & \$ 20,000 \\\hline \text { Unrealized receivables } & 0 & 15,000 \\\hline \text { Inventory } & \$ 30,000 & 35,000 \\\hline \text { Land (Sec. } 1231 \text { asset) } & 40,000 & 70,000 \\\hline\end{array}$$ By how much must XYZ reduce its unrealized receivables to avoid meeting the substantially appreciated inventory test?

• A)$10,000
• B)$14,000
• C)$15,000
• D)No amount of reduction of unrealized receivables will affect meeting the substantially appreciated inventory test.

---

Definitions:

Rhodopsin

A pigment found in the photoreceptor cells of the retina, essential for vision in low-light conditions.

Optic Chiasm

An X-shaped structure formed by the crossing over of the optic nerves, allowing visual information from each eye to be processed by both sides of the brain.

Ganglion Cells

Type of neurons located in the retina, transmitting visual information from photoreceptors to the brain.

Photoreceptors

Specialized cells in the retina of the eye that respond to light.