Section 10 inclass problems student

Mai is going to contribute the following assets to a business entity in exchange for an ownership interest.  Adjusted Basis FMVCash $100,000 $100,000Land and building 60,000 95,000What are the tax consequences of the contribution to Mai if the business entity is a(n):a. Sole proprietorship?  b. General partnership?  c. Limited partnership?  d. C corporation?  e. S corporation?

X and Y were partners in a firm with a profit sharing ratio of 7:5. During the year ended 31.12.2012 Y makes the drawings as under: Date Amount ($) 01.02.2012 14,000 01.05.2012 10,000 30.06.2012 5,000 31.10.2012 12,000 31.12.2012 4,000 Partnership deed provides that partners are to be charged interest on drawings @ 10% per annum. Calculate the interest chargeable to Y by using Simple Interest Method and Product Method.

Bella Partnership is an equal partnership in which each of the partners has a basis in their partnership interest of $10,000. Bella reports the following balance sheet: Tax Basis FMV $ 20,000 $30,000 10,000 15,000 $ 30,000 $ 45,000 Assets Inventory Land Totals Liabilities and capital Capital-Toby Capital-Kaelin Capital-Andrew Totals Required: $ 10,000 10,000 10,000 $ 30,000 a-1. Identify the hot assets if Toby decides to sell his partnership interest. a-2. Are these assets "hot" for purposes of distributions?

If partners A & B agreed to divide profits and losses in the ratio of 60% and 40% respectively. How much would be the share of A if the partnership profit for the year is P275,000?

In Year 1 you invested $500,000 in exchange for a 40% partnership interest in ABC, LP. You later received a K-1 from ABC reporting $50,000 as your share of ABC’s Year 1 taxable income. During Year 1 you received a cash distribution from ABC of $75,000. You received a K-1 from ABC reporting $85,000 as your share of ABC’s Year 2 NOL. During Year 2 you received a cash distribution from ABC of $90,000. You received a K-1 from ABC reporting $110,000 as your share of ABC’s Year 3 taxable income. During Year 3 you received a cash distribution from ABC of $125,000. After all of the above, what is your adjusted tax basis in your partnership interest in ABC?   $________

Distribution of Profits or Losses Based on Partners' Agreement Pasia, Te, and Ocenar each receive a P70,000 salary, as well as 15% interest on their respective average investments of P200,000, P100,000, and P400,000. If they share remaining profits and losses in a 4:3:2 ratio, respectively, by how much would Ocenar account increase or decrease (indicate a decrease by placing parentheses), assuming: (a) profit of P405,000, (b) profit of P270,000, and (c) loss of P315,000. In addition, calculate (d) Ocenar share of a P350,000 profits if profit and loss distributions were based instead solely on the ratio of average capital investments.

A, B and C share profits and losses in the ratio of 3:2:1. C is to receive a salary of K30, 000 as managing partner, and interest at the rate of 15% p. a is to be charged on drawings. Further, Interest to be earned by partners on their capital contributed. The following are the results of the profits and losses appropriated for the current year. Net profit K200, 0000 Salary K30, 000 Interest on drawings A K10, 000 B K8, 000 C K7, 000 Interests on capital A K20, 000 B K15, 000 C K15, 000 You are required to calculated the partners share of taxable income for tax purposes.

Scenario B: Partners A, B, and C operate a business with profit sharing agreement ratios of 5: 3:2, and capital balances of $300,000, $200,000, and $100,000 respectively. The total income for the year is $180,000. Each partner receives a fixed salary of $50, 000, and they are entitled to earn 10% interest on their capital balances. Calculate the total income allocated to Partner