_____ A, B, and C Are in Partnership and Share

Multiple Choice

_____ A, B, and C are in partnership and share profits and losses equally. C is retiring. The balance in C's capital account is $60,000. C is to be given a cash bonus of $5,000 as a result of unrecorded goodwill. The partnership has liabilities of $18,000 at the time of C's withdrawal. C's tax basis is $55,000. C's taxable gain or loss is:

A) A gain of $4,000.
B) A gain of $5,000.
C) A gain of $10,000.
D) A gain of $11,000.
E) A gain of $16,000.