Liz and John formed the equal LJ Partnership on January 1 of the current year. Liz contributed $80,000 of cash and land with a fair market value of $90,000 and an adjusted basis of $75,000. John contributed equipment with a fair market value of $170,000 and an adjusted basis of $20,000. John had used the equipment in his sole proprietorship. g. How will the partnership depreciate any assets it receives from the partners? h. Do additional considerations arise because of the difference between the basis and fair market values of the property John contributed?
Liz and John formed the equal LJ Partnership on January 1 of the current year. Liz contributed $80,000 of cash and land with a fair market value of $90,000 and an adjusted basis of $75,000. John contributed equipment with a fair market value of $170,000 and an adjusted basis of $20,000. John had used the equipment in his sole proprietorship. g. How will the partnership depreciate any assets it receives from the partners? h. Do additional considerations arise because of the difference between the basis and fair market values of the property John contributed?
Chapter21: Partnerships
Section: Chapter Questions
Problem 31P
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Liz and John formed the equal LJ
g. How will the partnership
h. Do additional considerations arise because of the difference between the basis and fair market values of the property John contributed?
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