On January 5, 2018, Mike Acquires a 50% Interest in Precision

Multiple Choice

On January 5, 2018, Mike acquires a 50% interest in Precision Tools Partnership by contributing property with an adjusted basis of $20,000 and a fair market value of $24,000, subject to a mortgage of $16,000. What is Mike's basis in Precision Tools Partnership as of January 5, 2018?

A) $- 0 -
B) $10,000
C) $12,000
D) $16,000
E) $20,000