Which of the Following Statements Is Always Correct Regarding Assets

question 242

Multiple Choice

Which of the following statements is always correct regarding assets acquired by a newly formed partnership? If a partner contributes:

• A) Depreciable property: the partnership treats the property as newly acquired depreciable property, and may claim a § 179 deduction.
• B) Unrealized (cash-basis) receivables: the partnership will report a capital gain when the receivable is collected.
• C) Inventory (in the partner's hands): the partnership reports ordinary income if the property is held as a capital asset and sold within five years of the contribution date.
• D) Land valued at less than its basis: the partnership reports a § 1231 loss if the property is sold at a loss.
• E) All of the above statements are always true.

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Definitions:

Bribery

The act of offering, giving, receiving, or soliciting something of value to influence the action of an official or other person in charge of a public or legal duty.

Worker Safety

The practices, policies, and regulations designed to protect employees from risks and hazards associated with their work environment.

Supply Availability

The extent to which goods, services, and materials needed by consumers or businesses are available for purchase or delivery.

Supply Research

The process of studying the market and suppliers to understand the availability, quality, and cost of materials or services needed by a business.