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Georgia's Interest in the equal GFH Partnership is liquidated when the GFH Partnership makes a Liquidating Distribution to Georgia and the remaining Partners assume Georgia's share of the Partnership Liabilities. Georgia receives $12,000 in Cash, Accounts Receivable of $21,000 (Fair Market Value) and Equipment worth (Fair Market Value) of $47,000. On the date of the Liquidation, the Partnership's Cash Basis Balance Sheet reflected the following: Cash (Adjusted Basis- $60,000; Fair Market Value - $60,000); Unrealized Receivable (Adjusted Basis-$-0-; Fair Market Value $63,000); Equipment (Adjusted Basis- $72,000; Fair Market Value - $141,000) (Total Assets: Adjusted Basis- $132,000; Fair Market Value - $264,000); Notes Payable (Adjusted Basis - $24,000; Fair Market Value - $24,000); Capital Accounts: Georgia Capital (Adjusted Basis - $36,000, Fair Market Value - $80,000); Freddie Capital (Adjusted Basis - $36,000; Fair Market Value - $80,000); Helen Capital (Adjusted Basis - $36,000; Fair Market Value-$80,000) (Total Liabilities And Equity (Capital)): Adjusted Basis- $132,000; Fair Market Value - $264,000). As a result of this Liquidation, Georgia has: O No Recognized Gain or Loss. O $20,000 Ordinary Income and $24,000 Capital Gain. $44,000 Ordinary Income and $-0- Capital Gain. O $24,000 Ordinary Income and $20,000 Capital Gain,

Georgia's Interest in the equal GFH Partnership is liquidated when the GFH Partnership makes a Liquidating Distribution to Georgia and the remaining Partners assume Georgia's share of the Partnership Liabilities. Georgia receives $12,000 in Cash, Accounts Receivable of $21,000 (Fair Market Value) and Equipment worth (Fair Market Value) of $47,000. On the date of the Liquidation, the Partnership's Cash Basis Balance Sheet reflected the following: Cash (Adjusted Basis- $60,000; Fair Market Value - $60,000); Unrealized Receivable (Adjusted Basis-$-0-; Fair Market Value $63,000); Equipment (Adjusted Basis- $72,000; Fair Market Value - $141,000) (Total Assets: Adjusted Basis- $132,000; Fair Market Value - $264,000); Notes Payable (Adjusted Basis - $24,000; Fair Market Value - $24,000); Capital Accounts: Georgia Capital (Adjusted Basis - $36,000, Fair Market Value - $80,000); Freddie Capital (Adjusted Basis - $36,000; Fair Market Value - $80,000); Helen Capital (Adjusted Basis - $36,000; Fair Market Value-$80,000) (Total Liabilities And Equity (Capital)): Adjusted Basis- $132,000; Fair Market Value - $264,000). As a result of this Liquidation, Georgia has: O No Recognized Gain or Loss. O $20,000 Ordinary Income and $24,000 Capital Gain. $44,000 Ordinary Income and $-0- Capital Gain. O $24,000 Ordinary Income and $20,000 Capital Gain,

SWFT Essntl Tax Individ/Bus Entities 2020
SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter14: Partnerships And Limited Liability Entities
Section: Chapter Questions
Problem 2BD
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Georgia's Interest in the equal GFH Partnership is liquidated when the GFH Partnership makes a Liquidating Distribution to Georgia and the remaining Partners assume Georgia's share of the Partnership Liabilities. Georgia receives $12,000 in Cash, Accounts Receivable of $21,000 (Fair Market Value) and Equipment worth (Fair Market Value) of $47,000. On the date of the Liquidation, the Partnership's Cash Basis Balance Sheet reflected the following: Cash (Adjusted Basis- $60,000; Fair Market Value - $60,000); Unrealized Receivable (Adjusted Basis-S-0-; Fair Market Value - $63,000); Equipment (Adjusted Basis- $72,000; Fair Market Value - $141,000) (Total Assets: Adjusted Basis- $132,000; Fair Market Value - $264,000); Notes Payable (Adjusted Basis - $24,000; Fair Market Value - $24,000); Capital Accounts: Georgia Capital (Adjusted Basis - $36,000, Fair Market Value - $80,000); Freddie Capital (Adjusted Basis- $36,000; Fair Market Value - $80,000); Helen Capital (Adjusted Basis- $36,000; Fair Market Value - $80,000) (Total Liabilities And Equity (Capital)): Adjusted Basis- $132,000; Fair Market Value - $264,000). As a result of this Liquidation, Georgia has: O No Recognized Gain or Loss. O $20,000 Ordinary Income and $24,000 Capital Gain. O$44,000 Ordinary Income and $-0- Capital Gain. O $24,000 Ordinary Income and $20,000 Capital Gain.
Transcribed Image Text:Georgia's Interest in the equal GFH Partnership is liquidated when the GFH Partnership makes a Liquidating Distribution to Georgia and the remaining Partners assume Georgia's share of the Partnership Liabilities. Georgia receives $12,000 in Cash, Accounts Receivable of $21,000 (Fair Market Value) and Equipment worth (Fair Market Value) of $47,000. On the date of the Liquidation, the Partnership's Cash Basis Balance Sheet reflected the following: Cash (Adjusted Basis- $60,000; Fair Market Value - $60,000); Unrealized Receivable (Adjusted Basis-S-0-; Fair Market Value - $63,000); Equipment (Adjusted Basis- $72,000; Fair Market Value - $141,000) (Total Assets: Adjusted Basis- $132,000; Fair Market Value - $264,000); Notes Payable (Adjusted Basis - $24,000; Fair Market Value - $24,000); Capital Accounts: Georgia Capital (Adjusted Basis - $36,000, Fair Market Value - $80,000); Freddie Capital (Adjusted Basis- $36,000; Fair Market Value - $80,000); Helen Capital (Adjusted Basis- $36,000; Fair Market Value - $80,000) (Total Liabilities And Equity (Capital)): Adjusted Basis- $132,000; Fair Market Value - $264,000). As a result of this Liquidation, Georgia has: O No Recognized Gain or Loss. O $20,000 Ordinary Income and $24,000 Capital Gain. O$44,000 Ordinary Income and $-0- Capital Gain. O $24,000 Ordinary Income and $20,000 Capital Gain.
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