Yong Contributes a Machine Having an Adjusted Basis of $20,000

question 53

Multiple Choice

Yong contributes a machine having an adjusted basis of $20,000 and an FMV of $25,000 for a 10% partnership interest. Yong had taken $10,000 of depreciation prior to the contribution. The partnership has no liabilities. As a result of the contribution, Yong must recognize

• A)no gain or loss.
• B)a $5,000 Sec. 1245 gain.
• C)a $5,000 capital gain.
• D)$10,000 ordinary income.

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Definitions:

Intractable Negotiation

A negotiation perceived as impossible to resolve due to deep-seated disagreements, high complexities, or significant power imbalances.

De-escalates

The process of reducing the intensity or severity of a conflict, situation, or potentially harmful behavior.

Self-Promotion

The act of advocating for oneself to advance personal goals, increase visibility, or improve status and opportunities.

Impression Management

The process by which individuals attempt to control the perceptions or impressions others have of them.