David and Joycelyn Form an Equal Partnership in the Current

question 117

Multiple Choice

David and Joycelyn form an equal partnership in the current year.No special allocation is provided for in the partnership agreement.During the year David contributes land having a $90,000 basis and a $100,000 FMV in exchange for the initial partnership interest.In addition,the partnership earns $50,000 of ordinary income while partnership liabilities increase from zero to $30,000 by the end of the tax year.The partnership earns $20,000 of tax-exempt interest during the year.David's basis at the end of the current year is

• A)$115,000.
• B)$125,000.
• C)$130,000.
• D)$140,000.

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A financial statement detailing the costs associated with preventing, detecting, and correcting defective work, categorized into prevention, appraisal, and failure costs.

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