Question 2 Lemon, Lime, and Orange, three cash method calendar year individuals, form Starburst General Partnership to create fruit candies. Before forming this partnership, they cach had their own sole proprietorship. The partners contribute the following property in each case worth $3,700 net of liabilities) in exchange for equal 1/3 interests in the partnership's capital profits and losses (see the table below of property contributed by each partner). The partnership assumes all liabilities encumbering the contributed assets. Assume that the partners are responsible for an equal share of the partnership's liabilities. What is the most that any specific partner recognizes on these transactions? Lemon contributes tand with a fair market value of $7,955, which is encumbered by a recourse mortgage of $4.995. Lemon has held the land for several years as an investment, and his basis in the land is $1,850. Lemon also contributes $740 in cash Lime contributes a building a 5 1231 asset, with a value of $4,810 in which Lime has an adjusted basis of $2,405. The building was purchased several years ago by Lime and is subject to a recourse mortgage $1.110. Orare contributes cero bonis accounts receivable from his business worth $6.475 and assigns his accounts payable of $2775 to the partnership 5370 50 31110 51.850 Previous Next