Leslie Contributes a Building Worth $88,000, with an Adjusted Basis

question 8

Multiple Choice

Leslie contributes a building worth $88,000, with an adjusted basis of $40,000, to a partnership in exchange for a 50 percent interest in the partnership's capital and profits.What is the amount of Leslie's basis in her partnership interest immediately after the contribution?

• A)$20,000
• B)$40,000
• C)$44,000
• D)$88,000
• E)None of the above

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Definitions:

Default Rule

A legal principle that applies in the absence of an agreement to the contrary between the parties involved in a contract or transaction.

Order Paper

A document listing the business or orders of the day for parliamentary bodies, including scheduled discussions, questions, and motions.

Drawer

In the context of negotiable instruments, this term refers to the party that creates or writes a check or a draft, instructing the drawee (usually a bank) to pay the specified amount to a third party (the payee).

Drawee

The party directed by a drafter (such as in the case of a cheque) to pay a certain amount of money to a third party.