Michelle pays $183,000 cash for Brittany's one-third interest in the Westlake Partnership. Just prior to the sale, Brittany's basis in Westlake is $96,300. Westlake reports the following balance sheet: Tax Basis FMV Assets $ 96,300 $ 96,300 192,600 $ 288,900 Cash Land 452,700 Totals $ 549,000 Liabilities and capital Capital-Amy Capital-Brittany Capital-Ben $ 96,300 $ 96,300 $ 96,300 $ 288,900 Totals (Leave no answer blank. Enter zero if applicable.) c. If Westlake were to sell the land for $452,700 shortly after the sale of Brittany's partnership interest, how much gain or loss would the partnership recognize? Recognized gain

Michelle pays $183,000 cash for Brittany's one-third interest in the Westlake Partnership. Just prior to the sale, Brittany's basis in Westlake is $96,300. Westlake reports the following balance sheet: Tax Basis FMV Assets $ 96,300 $ 96,300 192,600 $ 288,900 Cash Land 452,700 Totals $ 549,000 Liabilities and capital Capital-Amy Capital-Brittany Capital-Ben $ 96,300 $ 96,300 $ 96,300 $ 288,900 Totals (Leave no answer blank. Enter zero if applicable.) c. If Westlake were to sell the land for $452,700 shortly after the sale of Brittany's partnership interest, how much gain or loss would the partnership recognize? Recognized gain

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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[The following information applies to the questions displayed below.]Cliff’s basis in his Aero Partnership interest is $16,900. Cliff receives a distribution of $29,400 cash from Aero in complete liquidation of his interest. Aero is an equal partnership with the following balance sheet: Tax Basis FMV Assets Cash $ 29,400 $ 29,400 Investment 16,900 16,900 Land 4,400 40,800 Totals $ 50,700 $ 87,100 Liabilities and capital Capital—Chris $ 16,900 Capital—Cliff $ 16,900 Capital—Cooper $ 16,900 Totals $ 50,700 Problem 21-57 Part b (Algo) b. If Aero has a §754 election in place, what is the amount of the special basis adjustment? please prvide correct solution
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