The XYZ partnership has the following balance sheet: ...
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Accounting
The XYZ partnership has the following balance sheet:
Basis
FMV
Land
$60,000
$81,000
Inventory
$27,000
$54,000
Unrealized Rec.
$ 0
$15,000
Liabilities
$30,000
$30,000
Capital, X
$21,000
$40,000
Capital, Y
$18,000
$40,000
Capital, Z
$18,000
$40,000
$87,000
$150,000
If X sells her partnership interest to W for $40,000 cash ($10,000 this year and $30,000 next year), what is her gain or loss each year, and what is its character? (Assume each partner has a 1/3 share of liabilities.)
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