Quiz: Interest Sales, Distributions, and Property
Adjustments
Due Sep 28 at 11:59pm
Points 50
Questions 25
Time Limit 90 Minutes
Instructions
The quiz:
Covers the Textbook material from Module 5: Week 5 – Module 6: Week 6.
Contains 25 multiple-choice and true/false questions.
Is limited to 1 hour and 30 minutes.
Allows 1 attempt
Is worth 50 points.
Submit this assignment by 11:59 p.m. (ET) on Sunday of Module 6: Week 6.
Attempt History
Attempt Time Score
LATEST Attempt 1 26 minutes 50 out of 50
Correct answers are hidden.
Score for this quiz: 50 out of 50
Submitted Sep 28 at 9:07pm
This attempt took 26 minutes.
Question 1
pts
Which of the following situations is related to partnership distributions in which the bases of
partnership assets will be adjusted if a Code Sec. 754 election is in effect?
The partner recognizes a loss on the distribution.
The partner takes bases in distributed assets that exceed their bases to the partnership.
The partner takes bases in distributed assets that are less than their bases to the partnership.
All of the above
, Question 2
pts
Partner D of the equal DEF partnership has a basis in her partnership interest of $7,000. The
partnership distributes property to her with a FMV = $102,000, basis = $90,000, and an
associated liability of $72,000. What is her basis in the partnership after the distribution?
$7,000
$31,000
$48,000
$55,000
Question 3
pts
Code Sec. 751(b) is activated when a distribution effectively results in an exchange of capital
gains property for ordinary income property (hot assets) or the reverse.
True
False
Question 4
pts
Class Time Partners is a general partnership with the following balance sheets:
Basis FMV
Cash $15,000 $15,000
Capital assets 35,000 75,000
Land 85,000 240,000
Totals $135,000 $330,000
Recourse liabilities $90,000 $90,000
Capital, Claire 15,000 80,000
Capital, Lorie 15,000 80,000
Capital, Tom 15,000 80,000
Totals $135,000 $330,000
The partners share equally in profits, losses and capital. Tom is negotiating to sell one-half of
his interest in the partnership to an unrelated buyer. Assume the buyer is willing to pay $50,000
cash for half Tom’s interest. What is the tax basis of the interest to be sold by Tom?
$45,000
$52,500
Adjustments
Due Sep 28 at 11:59pm
Points 50
Questions 25
Time Limit 90 Minutes
Instructions
The quiz:
Covers the Textbook material from Module 5: Week 5 – Module 6: Week 6.
Contains 25 multiple-choice and true/false questions.
Is limited to 1 hour and 30 minutes.
Allows 1 attempt
Is worth 50 points.
Submit this assignment by 11:59 p.m. (ET) on Sunday of Module 6: Week 6.
Attempt History
Attempt Time Score
LATEST Attempt 1 26 minutes 50 out of 50
Correct answers are hidden.
Score for this quiz: 50 out of 50
Submitted Sep 28 at 9:07pm
This attempt took 26 minutes.
Question 1
pts
Which of the following situations is related to partnership distributions in which the bases of
partnership assets will be adjusted if a Code Sec. 754 election is in effect?
The partner recognizes a loss on the distribution.
The partner takes bases in distributed assets that exceed their bases to the partnership.
The partner takes bases in distributed assets that are less than their bases to the partnership.
All of the above
, Question 2
pts
Partner D of the equal DEF partnership has a basis in her partnership interest of $7,000. The
partnership distributes property to her with a FMV = $102,000, basis = $90,000, and an
associated liability of $72,000. What is her basis in the partnership after the distribution?
$7,000
$31,000
$48,000
$55,000
Question 3
pts
Code Sec. 751(b) is activated when a distribution effectively results in an exchange of capital
gains property for ordinary income property (hot assets) or the reverse.
True
False
Question 4
pts
Class Time Partners is a general partnership with the following balance sheets:
Basis FMV
Cash $15,000 $15,000
Capital assets 35,000 75,000
Land 85,000 240,000
Totals $135,000 $330,000
Recourse liabilities $90,000 $90,000
Capital, Claire 15,000 80,000
Capital, Lorie 15,000 80,000
Capital, Tom 15,000 80,000
Totals $135,000 $330,000
The partners share equally in profits, losses and capital. Tom is negotiating to sell one-half of
his interest in the partnership to an unrelated buyer. Assume the buyer is willing to pay $50,000
cash for half Tom’s interest. What is the tax basis of the interest to be sold by Tom?
$45,000
$52,500
