During 2013, Adams, a general contractor, Brinks, an architect, and Carson, an interior decorator, formed the Dex Home Improvement General Partnership by contributing the assets below.
Asset Adjusted basis Fair market value % of partner share in capital, profits & losses
Adams Cash $40,000 $40,000 50%
Brinks Land $12,000 $21,000 20%
Carson Inventory $24,000 $24,000 30%
The land was a capital asset to Brinks, subject to a $5,000 mortgage, which was assumed by the partnership.
For items 1 and 2, determine and select the initial basis of the partner's interest in Dex.
OK. I AM MISSING BIG TIME. THE FIRST ONE IS SIMPLE. SECOND ONE HOW HE IS SAYING 25,500? I THOUGHT INITIAL BASIS IS THE PARTNERS ADJUSTED BASIS.
BEC Passed
FAR Passed
AUD Passed
REG Passed
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