Lydia and Oliver wish to form a partnership to conduct a new business. They each contribute the following assets in exchange for equal interests in LO Partnership. Lydia's tax basis in the contributed equipment is $22,000 and Oliver's tax basis in the contributed equipment is $57,000. Lydia Oliver
Cash $50,000 $70,000
Business equipment (FMV)​50,000 30,000
a. Compute each individual's realized and recognized gain or loss on the formation of LO Partnership.
b. Compute each individual's tax basis in their half interest in LO Partnership.
c. Compute the partnership's tax basis in the equipment contributed by each individual partner.
Yes, the question is based on U. S. taxation.

Yang corporation starts a foreign subsidiary on january 1 by investing 20,000 rand. yang owns all of the shares of the subsidiary’s common stock. the foreign subsidiary generates 40,000 rand of net income throughout the year and pays no dividends. the rand is the foreign subsidiary’s functional currency. currency exchange rates for 1 rand are as follows: lo 10-3 january $0.25 = 1 rand average for the 0.28 = 1 december 0.31 = 1 in preparing consolidated financial statements, what translation adjustment will yang report at the end of the current year? a. $400 positive (credit). b. $1,000 positive (credit). c. $1,400 positive (credit). d. $2,400 positive (credit). hoyle, joe ben; hoyle, joe ben. advanced accounting (page 513). mcgraw-hill higher education. kindle edition.