M and E are equal partners in the ME Partnership. E decides to leave the partnership and receives a liquidating distribution of $15,000 cash and two items ofinventory. Inventory R has a basis of $1,000 and a fair market value of $7,000 and Inventory S has a basis of $2,000 and a fair market value of $5,000. E's adjusted basis for her partnership interest is $40,000. In addition to the cash and inventory, E also receives two parcels of land that are investment assets. Parcel
A has a basis to the partnership of $12,000 and a fair market value of $16,000. Parcel B has a basis to the partnership of $20,000 and a fair market value of $18,000. What is E's basis in Parcel A and Parcel B? Assume that this distribution is proportionate. Please show all calculations.