Tim, Al, and Pat Contributed Assets to Form the Equal

question 70

Multiple Choice

Tim, Al, and Pat contributed assets to form the equal TAP Partnership.Tim contributed cash of $40,000 and land with a basis of $80,000 (fair market value of $60,000) .Al contributed cash of $60,000 and land with a basis of $50,000 (fair market value of $40,000) .Pat contributed cash of $60,000 and a fully depreciated property ($0 basis) valued at $40,000.Which of the following tax treatments is not correct?

• A)Tim's basis in his partnership interest is $120,000.
• B)Al realizes and recognizes a loss of $10,000.
• C)Pat realizes a gain of $40,000 but recognizes $0 gain.
• D)TAP has a basis of $80,000, $50,000, and $0 in the land and property (excluding cash) contributed by Tim, Al, and Pat, respectively.
• E)All of these statement are correct.

Recognize the role of conformity and consensus in individual judgment.

Comprehend the process of persuasion and the factors that affect it.

Grasp the impact of first impressions and stereotype expectations on perception.

Analyze the implications of increased funding for social science research.

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Definitions:

State Statute

A written law passed by a legislative body at the state level.

Usage Of Trade

Any practice or method of dealing having such regularity of observance in a place, vocation, or trade as to justify an expectation that it will be observed with respect to the transaction in question.

Commercial Practices

Activities, methods, and ethics involved in conducting business and trading of goods and services in the marketplace.

Oral Contract

An agreement between parties that is spoken and not memorialized in writing, yet is fully legal and binding.