Victor Is a One-Third Partner in the VRX Partnership, with an Outside

question 117

Essay

Victor is a one-third partner in the VRX Partnership, with an outside basis of $156,000 on January 1. Victor sells his partnership interest to Raj on January 1 for $200,000 cash. The VRX Partnership has the following assets and no liabilities as of January 1:
The equipment was purchased for $360,000 and the partnership has taken $90,000 of depreciation. The stock was purchased seven years ago. What is the amount and character of Victor's gain or loss on the sale of his partnership interest?

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Definitions:

Ownership of Partnership

Ownership of a partnership refers to the proportionate share of rights, interests, and responsibilities in a partnership business, held by each partner.

Bonita's Share

A specific portion or allotment of a larger amount or entity that is designated or attributed to a person named Bonita.

Whole Business

A term often used in finance and economics referring to considering all aspects and operations of a business entity as a total entity.

Hockey Team

A hockey team is a group of players who compete together in the sport of hockey, governed by rules and often part of a league or competition.