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11. Que received a 60% capital interest in the OPP Partnership. Que designs the building the...

11. Que received a 60% capital interest in the OPP Partnership. Que designs the building the partnership will use for its offices. Que normally would charge a $17,000 fee for a similar building design. Based on the other partner's contributions, the 60% interest has a FMV of $27,000. The partnership has no liabilities. What is Que's basis in his 60% partnership interest? a. $ 27,000 b. $ 17,000 c. $ 44,000 d. $ 0

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Answer #1

The answer is option a)$ 27000

Each partner’s initial contribution is recorded on the partnership’s books. These contributions are recorded at the fair value of the asset at the date of transfer. All partners must agree to the valuation being recorded.Based on the contribution made by the other partners Que's contribution can be valued at $ 27000.If we record any other amount as the capital interest, the percentage of 60% as capital interest will be altered.

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