During the Current Year, John and Ashley Form the JA

True/False

During the current year, John and Ashley form the JA Partnership and agree to share profits and losses equally. Ashley contributes land with a fair market value of $80,000 (subject to a $30,000 nonrecourse mortgage). On the contribution date, Ashley's adjusted basis in the land is $40,000. Immediately after formation, Ashley's partnership outside basis is $25,000.