Solve and compute

PROBLEM 12 Partnership Distributions- Distributions in Liquidation of the Partnership Code References: $5 64, 731(a), 732(b), 732(c), 733, and 735(a) Regulations: $5 1.731-1(a), 1.731-1(b), 1.732-1(b), and 1.732-1(c) QUESTIONS A and B are equal partners in the AB partnership. AB has the following assets; Fair Market Adjusted Basis Value Cash $ 60 $ 60 Accounts Receivable 30 Inventory 30 30 Land (investment) 120 60 Total $210 $180 A's basis in her partnership interest is $100. B's basis is $75. A and B pur- 12P-112P-2 DISTRIBUTIONS IN LIQUIDATION chased their interests from C and D in separate transactions spanning a three- year period without precipitating a termination. The partnership never has elected under $ 754. What is each partner's gain or loss and basis in the distrib uted assets if the partnership is liquidated as follows? 1. A and B each receives one-half of each asset. 2. A receives the land, one-half of the inventory, and one-half of the accounts receivable, and B receives the cash, one-half of the inventory, and one- half of the accounts receivable. 3. A receives the cash, one-half of the inventory, and one-half of the ac- counts receivable, and B receives the land, one-half of the inventory, and one-half of the accounts receivable. 4. A receives the land and the accounts receivable, and B receives the cash and inventory. 5. A receives the cash and accounts receivable, and B receives the land and the inventory