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QUESTION
May and Lori form the ML General Partnership. May contributed $20,000 cash in exchange for her 50 percent partnership interest.
- May and Lori form the ML General Partnership. May contributed $20,000 cash in exchange for her 50 percent partnership interest. During the first year of partnership operations, the partnership reported net taxable income of $10,000, May withdrew $8,000 cash from the partnership, and the partnership took out an $18,000 loan on the last day of the year. May's adjusted basis for her partnership interest at year end is:
a. $38,000
b. $30,000
c. $26,000
d. $25,000
e. $20,000
f. $17,000
