Kent contributed $50,000 in exchange for a 40% interest in a partnership at the beginning of the year. The partnership has no liabilities in place at the time of Kent's contribution. At the end of the year, the partnership correctly allocates $30,000 ordinary loss and a $50,000 long term capital loss to Kent. In addition, during the year, the partnership borrowed $100,000. $40,000 of this liability is allocable to Kent. At the end of the year, Kent's outside basis equals ____ and his capital account equals _______.
Kent contributed $50,000 in exchange for a 40% interest in a partnership at the beginning of the year. The partnership has no liabilities in place at the time of Kent's contribution. At the end of the year, the partnership correctly allocates $30,000 ordinary loss and a $50,000 long term capital loss to Kent. In addition, during the year, the partnership borrowed $100,000. $40,000 of this liability is allocable to Kent. At the end of the year, Kent's outside basis equals ____ and his capital account equals _______.
Chapter11: Invest Or Losses
Section: Chapter Questions
Problem 38P
Related questions
Question
Kent contributed $50,000 in exchange for a 40% interest in a partnership at the beginning of the year. The partnership has no liabilities in place at the time of Kent's contribution. At the end of the year, the partnership correctly allocates $30,000 ordinary loss and a $50,000 long term capital loss to Kent. In addition, during the year, the partnership borrowed $100,000. $40,000 of this liability is allocable to Kent. At the end of the year, Kent's outside basis equals ____ and his capital account equals _______.
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
![Individual Income Taxes](https://www.bartleby.com/isbn_cover_images/9780357109731/9780357109731_smallCoverImage.gif)
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT