Answer: See explanation
Explanation:
a. What is Laurel’s initial tax basis in her LLC interest?
This will be the addition of the $250,000 basis for the equipment, accounts payable of $15,000 and also the $15,000 (15% × $100,000). This will be:
= $250,000 + $15,000 + $15,000
= $280,000
b. True.
Laurel’s holding period in the partnership interest begins the day the LLC interest is acquired. This is due to the fact that the asset contributed isn't a section 1232 asset. The reason for this is due to the fact that the asset was used for a year or less.
c. Sand Creek’s initial basis in the contributed property is $250,000.
d. Ten months.
Sand Creek’s holding period in the contributed property will be 10 months.
Answer:
D. best-case scenario.
Explanation:
This is true because, there are two scenarios involved in the production- Jimenas' company's production method and Spicy Sides company's method. She is trying to compare the two production methods and comes up with the best case scenario that leads to low cost of production.
There is not enough information to have a significant answer
