The PW Partnership's Balance Sheet Includes the Following Assets Immediately

question 116

Multiple Choice

The PW Partnership's balance sheet includes the following assets immediately before it liquidates: In complete liquidation, PW distributes the cash to Pamela and the unrealized receivables to Wade (equal partners) . Pamela and Wade each have an outside basis in PW equal to $5,000. PW has no liabilities at the time of the liquidation. What is the amount and character of Pamela's recognized gain or loss?

• A) $0.
• B) $5,000 capital gain.
• C) $5,000 ordinary income.
• D) $2,500 capital gain and $2,500 ordinary income.

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Definitions:

Physical Therapy

A branch of rehabilitative health that uses specially designed exercises and equipment to help patients regain or improve their physical abilities.

Functional Limitations

Restrictions in the ability to perform tasks in the manner or within the range considered normal for a human being, often due to disability or illness.

Physical Impairment

A physical condition that significantly restricts one or more major life activities, potentially including mobility, dexterity, or sensory functions.

Socio-economic

Relating to or concerned with the interaction of social and economic factors.