Question: Paula purchases a 40% interest in Dancer Enterprises for $52,000 on January 2 of the current year. Dancer is organized as a partnership and has

Paula purchases a 40% interest in Dancer Enterprises for $52,000 on January 2 of the current year. Dancer is organized as a and has an income of $50,000 in the current year. Dancer also distributes a total of $15,000 to the partners in the current year. What are the tax effects to Paula of her investment in Dancer? What is her adjusted basis in the at the end of the current year?

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