June owned and operated a retail establishment as a sole proprietor. She became a partner in Jay's partnership. She contributed an appliance from her retail inventory to the partnership. The partnership sold the item for $3,500 two years later. June's adjusted basis in the appliance was $2,750. How should the partnership report the gain on the transaction? Question 17Select one: a. The partnership should report the $750 as a capital loss. b. The partnership is not required to report a gain on the transaction. c. The $750 gain should be reported as ordinary income because the inventory item was sold within five years of contribution. d. The partnership should report a capital gain of $750 on the sale of the inventory item