Under What Conditions Will a Partner Recognize a Gain in a Liquidating

question 104

Multiple Choice

Under what conditions will a partner recognize a gain in a liquidating distribution?

• A)When a partnership distributes only money and the amount of the distribution exceeds the partner's outside basis.
• B)When a partnership distributes only money and the amount of the distribution is less than the partner's outside basis.
• C)When a partnership distributes money, hot assets, and other property and the amount of the distribution exceeds the partner's outside basis.
• D)When a partnership distributes money, hot assets, and other property and the amount of the distribution is less than the partner's outside basis.

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Definitions:

Subsidiary Ledgers

Detailed ledgers that contain information about specific accounts, supporting the amounts reported in the general ledger.