alainves
Newbie
Joined: 02 Jan 2016
Online Status: Offline
Posts: 1
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| Posted: 05 Jul 2016 at 11:02 | IP Logged
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Hi Guys:
I need help with these exercises.
1) Peter, one of two equal partners of the Regit
Partnership, a general partnership, contributed
property used in his trade or business property with
an adjusted basis to him of $15,000 and a fair market
value of $10,000 to the Regit Partnership. Peter’s
capital account was credited with $10,000. The
property later was sold for $12,000. As a result of
this sale, how much gain or loss is allocable to
Peter?
a. $1,000 gain
b. $1,500 loss
c. $2,000 gain
d. $3,000 loss
My understanding is that there is a built-in loss of
5,000, now, the property was sold for 12,000 minus
15,000 basis we get a 3,000 loss. Since Peter already
has a 5,000 loss how do we treat the 3,000 loss from
the sale of the property??
2) Same case but now the property is sold for 16,000
a. $1,000 loss
b. $1,000 gain
c. $500 gain
d. $6,000 loss
e. None of the above
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Topic: Partnership
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