In a Proportionate Liquidating Distribution in Which the Partnership Is

question 212

Essay

In a proportionate liquidating distribution in which the partnership is liquidated, Bill received cash of $120,000, inventory (basis of $6,000, fair market value of $8,000), and a capital asset (basis and fair market value of $16,000). Immediately before the distribution, Bill's basis in the partnership interest was $90,000.

a. How much gain or loss will Bill recognize on the distribution?
b. What is Bill's basis in the inventory and the capital asset?

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Definitions:

Body Work Time

The duration of time allocated for or spent on the physical repair or refurbishment of a vehicle's body.

Paint Time

The duration required to apply and dry paint on a product, significant in manufacturing and production scheduling.

Makespan

The total time needed to complete a set of tasks, from the start of the first task to the end of the last one.

Splitting

The process of dividing a task, batch, or workload into smaller, more manageable parts to improve efficiency, speed up processing, or better allocate resources.