Frank and Bob Are Equal Members in Soxy Socks, LLC

question 18

Multiple Choice

Frank and Bob are equal members in Soxy Socks, LLC. When forming the LLC, Frank contributed $44,000 in cash and $44,000 worth of equipment. Frank's adjusted basis in the equipment was $29,000. Bob contributed $44,000 in cash and $44,000 worth of land. Bob's adjusted basis in the land was $36,000. On 3/15/X4, Soxy Socks sells the land Bob contributed for $66,000. How much gain (loss) related to this transaction will Bob report on his X4 return?

• A)$22,000
• B)$33,000
• C)$19,000
• D)$41,000

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Definitions:

Marijuana

A psychoactive drug from the Cannabis plant used for medical or recreational purposes, known for containing THC among other cannabinoids.

Data

factual information or measurements collected for analysis, reference, or reasoning, used in making decisions or determining conclusions.

THC

Tetrahydrocannabinol, the psychoactive compound found in cannabis plants that is responsible for most of marijuana's psychological effects.

Hashish

A drug made from the resin of the cannabis plant, known for its psychoactive effects.