Mirabelle Contributed Land with a $5,000 Basis and a $9,000

question 97

Multiple Choice

Mirabelle contributed land with a $5,000 basis and a $9,000 FMV to MS Partnership four years ago.This year the land is distributed to Sergio,another partner in the partnership.At the time of distribution,the land had a $12,000 FMV.How much gain should Mirabelle and Sergio recognize?

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Definitions:

Average Total Cost

The total cost of production divided by the number of units produced, encompassing both fixed and variable costs.

Total Variable Costs

The sum of expenses that vary directly with the level of production or sales volume.

Marginal Cost

The amount of money needed to create an additional unit of a product or service.

Average Total Costs

The total costs of production (fixed and variable) divided by the quantity of output produced.