The Total Bases of All Distributed Property in the Partner's

question 65

Multiple Choice

The total bases of all distributed property in the partner's hands following a nonliquidating distribution is limited to

• A)the partner's predistribution basis in his partnership interest.
• B)the FMV of the property distributed.
• C)the partnership's bases in the distributed property.
• D)the predistribution FMV of the partner's partnership interest.

---

Definitions:

Permanent/Temporary

Refers to the classification of accounts where permanent accounts are balance sheet items that carry over into the next fiscal period, and temporary accounts are income statement items that are closed to equity at the end of the fiscal period.

Normal Balance

Reflects the expected balance orientation (debit for assets and expenses, credit for liabilities, equity, and revenues) of an account in double-entry bookkeeping.

Financial Statement

A written record that conveys the business activities and financial performance of a company, typically including the balance sheet, income statement, and cash flow statement.

Permanent/Temporary

Refers to accounts on a company's balance sheet that are carried over from one accounting period to the next, with permanent indicating long-term accounts and temporary indicating accounts that are closed at the end of each period.