Please read the following carefully. For each question on the exam, you should assume that:

1. unless expressly stated to the contrary, all events occurred in the current taxable year;

2. all persons are United States citizens;

3. there is no tax avoidance purpose for any transaction, and that with respect to any mortgage on any property, there was a bona fide business purpose for incurring or assuming the debt;

4. unless expressly stated to the contrary, the partnership has no hot assets, has no debts or other liabilities, and does not have a Section 754 election in effect;

5. each partnership is a general partnership;

6. there are no special allocation provisions contained in any partnership agreement; and

7. unless expressly stated to the contrary, or the context of the question requires a conclusion that the distribution was not pro rata - such as the liquidation of the interest of just one partner, all partnership distributions were pro rata.

8. All taxpayers are calendar year taxpayers.

The ABCD partnership has four partners. Each partners adjusted basis in the partnership interest owned by that partner was $40,000 on the first day of last year. The partnership reported net income for last year of $80,000 (there were no separately stated items to take into account). The partnership distributed pro rata to each partner $55,000 in cash plus identical parcels of land that each had a fair market value of $25,000 and a basis to the partnership of $10,000. What is each partners adjusted basis in the land distributed to the partner?

a. 0

b. $20,000

c. $15,000

d. $10,000

e. $5,000