Sue and Andrew Form SA General Partnership

question 126

Multiple Choice

Sue and Andrew form SA general partnership. Each person receives an equal interest in the newly created partnership. Sue contributes $27,000 of cash and land with an FMV of $72,000. Her basis in the land is $37,000. Andrew contributes equipment with an FMV of $29,000 and a building with an FMV of $50,000. His basis in the equipment is $25,000, and his basis in the building is $37,000. How much gain must the SA general partnership recognize on the transfer of these assets from Sue and Andrew?

• A)$0
• B)$4,000
• C)$48,000
• D)$52,000

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Definitions:

Family's Life

Refers to the everyday events, interactions, and relationships that occur within a family unit.

Primary Wage Earner

The primary wage earner is the person in a household responsible for contributing the majority of income to sustain the family's living expenses.

Mother

A female parent or individual who fulfills the role of nurturing and raising a child.

Overtime Work

Work performed beyond the standard hours set for a workday or workweek, typically compensated at a higher pay rate.