Question: 7 . Yong contributes a machine having an adjusted basis of $45,000 and an FMV of $55,000 for a 15% partnership interest. Yong had taken

7. Yong contributes a machine having an adjusted basis of $45,000 and an FMV of $55,000 for a 15% partnership interest. Yong had taken $15,000 of depreciation prior to the contribution. The partnership has no liabilities. As a result of the contribution, Yong must recognize

A) no gain or loss.

B) a $10,000 Sec. 1245 gain.

C) a $10,000 capital gain.

D) $10,000 ordinary income.

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