Partner A contributed property to the partnership that was inventory in his hands. The contributed...
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Accounting
Partner A contributed property to the partnership that was inventory in his hands. The contributed inventory consisted of computer equipment that the contributing partner sold in his retail store. Notwithstanding, the partnership used the computers in its restaurant operations.
In light of the foregoing, which of the following statements is correct?
Select one:
a.
The inventory will always remain inventory in the hands of the partnership.
b.
Gains or losses attributable to the contributed computers will be characterized under section 1231 if the partnership sells the property more than 1 year from the date of contribution.
c.
The partnership will recognize an ordinary gain or loss if it disposes the computer equipment two years after the contribution.
d.
Whether the contributed inventory is ordinary income property or section 1231 property depends on the immediate use to which the partnership puts the property.
e.
Two of the above.
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