Question

Daniel acquires a 30% interest in the PPZ Partnership from Paolo, an existing partner, for $43,500 of cash. The PPZ Partnership has borrowed $14,500 of recourse liabilities as of the date Daniel bought the interest. What is Daniel's basis in his partnership interest?

a. $47,200.
b. $14,000.
c. $57,000.
d. $52.800.

Answer 1

the daniel basis in his partnership interest is $47,850

Step-by-step explanation:

The computation of the daniel basis in his partnership interest is shown below:

= Cash + Borrowed amount × interest acquiring percentage

= $43,500 + $14,500 × 30%

= $43,500 + $4,350

= $47,850

This is the answer but the same is not provided in the given options

Hence, the daniel basis in his partnership interest is $47,850

We simply applied the above formula so that the correct value could come

And, the same is to be considered