AB Corporation and YZ Corporation formed a partnership to construct a shopping mall. AB contributed $576,000 cash, and YZ contributed land ($576,000 FMV and $506,000 basis) in exchange for a 50 percent interest in ABYZ Partnership. Immediately after its formation, ABYZ borrowed $288,000 from a local bank. The debt is recourse (unsecured by any specific partnership asset). Compute each partner’s initial basis in its partnership interest, assuming that both AB and YZ are general partners. Compute each partner’s initial basis in its partnership interest, assuming that AB is a general partner, and YZ is a limited partner.

Neveready flashlights inc. needs $317,000 to take a cash discount of 3/15, net 70. a banker will loan the money for 55 days at an interest cost of $13,200. a. what is the effective rate on the bank loan? (use a 360-day year. do not round intermediate calculations. input your answer as a percent rounded to 2 decimal places.) b. how much would it cost (in percentage terms) if the firm did not take the cash discount but paid the bill in 70 days instead of 15 days? (use a 360-day year. do not round intermediate calculations. input your answer as a percent rounded to 2 decimal places.) c. should the firm borrow the money to take the discount? no yes d. if the banker requires a 20 percent compensating balance, how much must the firm borrow to end up with the $317,000? e-1. what would be the effective interest rate in part d if the interest charge for 55 days were $7,200?

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