On December 1, Antonio, a Member of a Three-Person Partnership

Multiple Choice

On December 1, Antonio, a member of a three-person partnership, purchases investment securities from the partnership for their $37,000 FMV. All partners share profits and losses equally. The securities were acquired by the partnership for $25,000 cash in March of the current year. What amount and character of gain will Antonio recognize because of this transaction?

A) $0 gain
B) $4,000 ordinary income
C) $4,000 short-term capital gain
D) $12,000 ordinary income