Larry and Jessica form the L&J Partnership. Larry contributes property with and adjusted basis of $70 000, a fair market value of $200 000 and subject to a liability of $80 000in exchange for a 40 % interest in the partnership. Jessica receives a 60 % interest in the partnership in exchange for services performed for the partnership, valued at $10 000 and cash of $170 000.
a) What is the amount of gain or loss that Larry recognizes as a result of this transfer of property to the partnership
b) What is Larry's basis in his partnership interest immediately after the formation of the partnership
c) What is the partnership basis in the property contributed by larry
d) What is Jessica's basis in her partnership interest immediately after the formation of the partnership