Melissa, Nicole, and Ben are equal partners in the Opto Partnership (calendar-year-end). Melissa decides she wants to exitthe partnership and receives a proportionate distribution to liquidate her partnership interest on January 1. The partnershiphas no liabilities and holds the following assets as of January 1:TaxBasisCashAccounts receivableStock investmentLandFMV$19,710 $ 19,71026,2808,64014,85047,400$64,050 $106,24035,700TotalsMelissa receives one-third of each of the partnership assets. She has a basis in her partnership interest of $28.705 (Leaveno answer blonk. Enter zero if applicable.)c1. What is the amount and character of Melissa's recognized gain or loss if her outside basis is $12,710 rather than $28,705?c2. What are Melissa's basis in the distributed assets if her basis in Opto Partnership is $12.710 rather than $28,705?

A partnership is a kind of business structure in which two or more people agree to carry out…

Melissa, Nicole, and Ben are equal partners in the Opto Partnership (calendar-year-end). Melissa decides she wants to exit the partnership and receives a proportionate distribution to liquidate her partnership interest on January 1. The partnership has no liabilities and holds the following assets as of January 1: Tax Basis Cash Accounts receivable Stock investment FHV $19,710 $ 19,710 26,280 8,640 35,700 14,850 47,400 Land Totals $64,050 $106, 240 Melissa receives one-third of each of the partnership assets. She has a basis in her partnership interest of $28,705. (Leave no answer blonk. Enter zero if applicable.) c1. What is the amount and character of Melissa's recognized gain or loss if her outside basis is $12,710 rather than $28,705? c2. What are Melissa's basis in the distributed assets if her basis in Opto Partnership is $12.710 rather than $28,705?

Melissa, Nicole, and Ben are equal partners in the Opto Partnership (calendar-year-end). Melissa decides she wants to exit the partnership and receives a proportionate distribution to liquidate her partnership interest on January 1. The partnership has no liabilities and holds the following assets as of January 1: Tax Basis Cash Accounts receivable Stock investment FHV $19,710 $ 19,710 26,280 8,640 35,700 14,850 47,400 Land Totals $64,050 $106, 240 Melissa receives one-third of each of the partnership assets. She has a basis in her partnership interest of $28,705. (Leave no answer blonk. Enter zero if applicable.) c1. What is the amount and character of Melissa's recognized gain or loss if her outside basis is $12,710 rather than $28,705? c2. What are Melissa's basis in the distributed assets if her basis in Opto Partnership is $12.710 rather than $28,705?

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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