If a Partnership Asset with a Deferred Precontribution Gain Is

question 84

True/False

If a partnership asset with a deferred precontribution gain is distributed within seven years of acquisition in a nonliquidating distribution to a partner who did not contribute the asset, the precontribution gain must be recognized by the contributing partner.

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Definitions:

Mid-Ocean Ridge

An underwater mountain range formed by plate tectonics, where new oceanic crust is created by volcanic activity and then spreads away from the ridge.

Island Arcs

Curved chains of volcanic islands located along a convergent tectonic plate boundary, formed by the subduction of an oceanic plate beneath another plate.

Basalt Eruptions

Volcanic eruptions that produce basalt, a dark-colored volcanic rock rich in iron and magnesium, characterized by low viscosity lava flows.

Ophiolite

A section of the Earth's oceanic crust and the underlying upper mantle that has been uplifted and exposed above sea level.