Sandy and Teddy formed a partnership. Sandy received a 60% interest in capital and profits...
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Accounting
Sandy and Teddy formed a partnership. Sandy received a 60% interest in capital and profits in exchange for contributing land with a basis of $180,000 and a fair market value of $300,000. Teddy received a 40% interest in capital and profits in exchange for contributing $200,000 of cash. Three years after the contribution date, the land contributed by Sandy is sold by the partnership to a third party for $380,000. How much taxable gain will Teddy recognize from the sale?
a. $72,000.
b. $48,000.
c. $32,000.
d. $80,000.
e. $120,000.
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