Cramer Corporation and Mr

question 73

Multiple Choice

Cramer Corporation and Mr. Chips formed a partnership in which Cramer is the general partner and Mr. Chips is a limited partner. Cramer contributed $500,000 cash, and Mr. Chips contributed a building with a $500,000 FMV and $300,000 tax basis. The partnership immediately borrowed $700,000 of recourse debt. What is Mr. Chips' tax basis in its partnership interest?

• A) $500,000
• B) $850,000
• C) $650,000
• D) $300,000

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Definitions:

Religious Customs

Traditional practices and rituals followed by members of a religion.

Nature-nurture Issue

The debate surrounding the relative contributions of genetic inheritance (nature) and environmental factors (nurture) to human development and behavior.

Natural Selection

In evolutionary biology, a procedure where life forms more effectively adjusted to their habitat are more apt to thrive and reproduce at a greater rate.

Charles Darwin

A British naturalist best known for his contributions to the science of evolution and the theory of natural selection.