Mark and Addison Formed a Partnership

question 108

Multiple Choice

Mark and Addison formed a partnership.Mark received a 25% interest in partnership capital and profits in exchange for land with a basis of $40,000 and a fair market value of $60,000.Addison received a 75% interest in partnership capital and profits in exchange for $180,000 of cash.Three years after the contribution date, the land contributed by Mark is sold by the partnership to a third party for $76,000.How much taxable gain will Mark recognize from the sale?

• A)$0.
• B)$9,000.
• C)$24,000.
• D)$36,000.
• E)None of the above.

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Definitions:

Incapacitated

Describes a state where an individual is unable to act or respond due to injury, illness, or disability.

Spousal Loss

The experience of losing a spouse through death or separation, with potential psychological, financial, and social implications.

Widowhood

The state or period of being a widow or widower, following the death of a spouse.

Alcohol Abuse

The harmful or hazardous use of alcohol, including excessive consumption that leads to health problems or social, occupational, and interpersonal issues.