In 2021, Autumn Partnership distributes the following assets to Spring Dupont (a partner in the partnership) in a proportionate, liquidating distribution: • Office furnishing (fair market value of $100,000 and basis to partnership of $30,000) • $40,000 of cash • Inventory (fair market value of $100,000 and basis to partnership of $20,000) Prior to the distribution Spring Dupont had an outside basis in the Autumn Partnership of $200,000 a. How much gain or loss will Spring Dupont recognize from this distribution? b. How much gain of loss will Autumn Partnership recognize from this distribution? c. What is Spring Dupont's basis in the office furnishings? What is Spring Dupont's basis in the inventory?

In 2021, Autumn Partnership distributes the following assets to Spring Dupont (a partner in the partnership) in a proportionate, liquidating distribution: • Office furnishing (fair market value of $100,000 and basis to partnership of $30,000) • $40,000 of cash • Inventory (fair market value of $100,000 and basis to partnership of $20,000) Prior to the distribution Spring Dupont had an outside basis in the Autumn Partnership of $200,000 a. How much gain or loss will Spring Dupont recognize from this distribution? b. How much gain of loss will Autumn Partnership recognize from this distribution? c. What is Spring Dupont's basis in the office furnishings? What is Spring Dupont's basis in the inventory?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Partnership Distribution In 2021, Autumn Partnership distributes the following assets to Spring Dupont (a partner in the partnership) in a proportionate, liquidating distribution: Office furnishing (fair market value of $100,000 and basis to partnership of $30,000) $40,000 of cash Inventory (fair market value of $100,000 and basis to partnership of $20,000) Prior to the distribution Spring Dupont had an outside basis in the Autumn Partnership of $200,000 How much gain or loss will Spring Dupont recognize from this distribution?
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