Xena and Xavier Form the XX LLC

question 112

Multiple Choice

Xena and Xavier form the XX LLC. Xena contributes cash of $20,000, land (basis = $40,000; fair market value = $25,000) , equipment (basis = $0; fair market value = $35,000) , and inventory (basis = $30,000; fair market value =
$40,000) . Xavier contributed $120,000 of cash. How much is the partnership's basis in the land, equipment, and inventory, and how much is Xena's basis in the partnership interest?

• A) $25,000 land, $0 equipment, $30,000 inventory; $55,000 partnership interest.
• B) $40,000 land, $0 equipment, $30,000 inventory; $90,000 partnership interest.
• C) $25,000 land, $35,000 equipment, $30,000 inventory; $105,000 partnership interest.
• D) $40,000 land, $35,000 equipment, $40,000 inventory; $135,000 partnership interest.

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Definitions:

Low Frequency

Pertaining to a rate of occurrence or a wave frequency that is lower than the average or expected.

High Amplitude

In wave phenomena, refers to waves that have a large peak value, indicating stronger or more intense waveforms.

Stage 3

Depending on the context, this could refer to the third phase in a developmental, psychological, or medical progression system.

Suprachiasmatic Nucleus

A tiny region in the brain's hypothalamus responsible for controlling circadian rhythms by regulating the body's internal clock.