1. Which of the following statements is false?
A. The apportionment of basis must reflect differences in relative fair market values of parcels being sold if such differences exist.
B. Equitable apportionment means ratable apportionment on a pro-rata basis.
C. There is an opportunity for tax planning in basis apportionment.
D. The Tax Court has held that the allocation of basis must be made at the time of purchase rather than at the time of sale.
2. Which situation is generally a consequence of overly strict loan repayment terms?
The borrower uses the funds for purposes other than loan repayment
The lender defers solely to the customer’s judgement
The lender could use the funds to lend to other borrowers
The borrower does not have the needed cash flow for operations