Alice, Bob, and Charles are one-third partners in the ABC Partnership. The partners originally formed the partnership with cash contributions, so no partner has precontribution gains or losses. Prior to Alice€™s sale of her partnership interest, the partnership has the following balance sheet:

Alice has a $110,000 basis in her partnership interest including her share of partnership liabilities, and she sells her partnership interest to Darla for $125,000 cash.
a. What are the amount and character of Alice€™s recognized gain or loss on the sale?
b. What is Darla€™s basis in her partnership interest?

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Partnership's Basis FMV Assets Cash Receivable Inventory Machinery Building" Land Investments S 12.000 57,000 90,000 120,000 36,000 15.000 S 12.000 21,000 72,000 132,000 165,000 30,000 48.000 Total S330,000 $480,00D Liabilities and capital Liabilities S105,000 S105,000 Partners' capital Alice 75,000 125,000 Bob 75,000 125,000 Charles Total $330,000 S480,000 aThe machinery cost S126,000, and the partnership has claimed 536,000 of depreciation. The building cost $150,000, and the partnership has claimed $30,000 of straight-line depreciation. The partnership has held the investments for more than one year,