Comprehensive Problem 20-81 (LO 20-1, LO 20- 2, LO 20-3, LO 20-4, LO 20-5, LO 20-6) (Algo) [The following information applies to the questions displayed below.] The TimpRiders LP has operated a motorcycle dealership for a number of years. Lance is the limited partner, Francesca is the general partner, and they share capital and profits equally. Francesca works full time managing the partnership. Both the partnership and the partners report on a calendar-year basis. At the start of the current year, Lance and Francesca had bases of $12,100 and $4,900, respectively, and the partnership did not have any liabilities. During the current year, the partnership reported the following results from operations: Net sales $ 708,000 Cost of goods sold 531,000 Operating expenses 192,000 Short-term capital loss 3,200 Tax-exempt interest 3,900 §1231 gain 7,900 On the last day of the year, the partnership distributed $4,900 each to Lance and Francesca. Comprehensive Problem 20-81
Comprehensive Problem 20-81 (LO 20-1, LO 20- 2, LO 20-3, LO 20-4, LO 20-5, LO 20-6) (Algo) [The following information applies to the questions displayed below.] The TimpRiders LP has operated a motorcycle dealership for a number of years. Lance is the limited partner, Francesca is the general partner, and they share capital and profits equally. Francesca works full time managing the partnership. Both the partnership and the partners report on a calendar-year basis. At the start of the current year, Lance and Francesca had bases of $12,100 and $4,900, respectively, and the partnership did not have any liabilities. During the current year, the partnership reported the following results from operations: Net sales $ 708,000 Cost of goods sold 531,000 Operating expenses 192,000 Short-term capital loss 3,200 Tax-exempt interest 3,900 §1231 gain 7,900 On the last day of the year, the partnership distributed $4,900 each to Lance and Francesca. Comprehensive Problem 20-81
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Accounting
Comprehensive Problem 20-81 (LO 20-1, LO 20-
2, LO 20-3, LO 20-4, LO 20-5, LO 20-6) (Algo)
[The following information applies to the
questions displayed below.]
The TimpRiders LP has operated a motorcycle
dealership for a number of years. Lance is the
limited partner, Francesca is the general partner,
and they share capital and profits equally.
Francesca works full time managing the
partnership. Both the partnership and the
partners report on a calendar-year basis. At the
start of the current year, Lance and Francesca
had bases of $12,100 and $4,900, respectively,
and the partnership did not have any liabilities.
During the current year, the partnership
reported the following results from operations:
Net sales $ 708,000
Cost of goods sold 531,000
Operating expenses 192,000
Short-term capital loss 3,200
Tax-exempt interest 3,900
§1231 gain 7,900
On the last day of the year, the partnership
distributed $4,900 each to Lance and Francesca.
Comprehensive Problem 20-81
Part 1 What outside basis do Lance and
Francesca have in their partnership interests at
the end of the year?
How much of their losses are currently not
deductible by Lance and Francesca because of
the tax-basis limitation?
To what extent does the passive activity loss
limitation apply in restricting their deductible
losses for the year?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F47d8463d-b8ec-47aa-8230-18b18f0b3293%2F9b4d05d7-1673-4a71-aa61-3c4ef6596d1d%2Fyq9s425_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Accounting
Comprehensive Problem 20-81 (LO 20-1, LO 20-
2, LO 20-3, LO 20-4, LO 20-5, LO 20-6) (Algo)
[The following information applies to the
questions displayed below.]
The TimpRiders LP has operated a motorcycle
dealership for a number of years. Lance is the
limited partner, Francesca is the general partner,
and they share capital and profits equally.
Francesca works full time managing the
partnership. Both the partnership and the
partners report on a calendar-year basis. At the
start of the current year, Lance and Francesca
had bases of $12,100 and $4,900, respectively,
and the partnership did not have any liabilities.
During the current year, the partnership
reported the following results from operations:
Net sales $ 708,000
Cost of goods sold 531,000
Operating expenses 192,000
Short-term capital loss 3,200
Tax-exempt interest 3,900
§1231 gain 7,900
On the last day of the year, the partnership
distributed $4,900 each to Lance and Francesca.
Comprehensive Problem 20-81
Part 1 What outside basis do Lance and
Francesca have in their partnership interests at
the end of the year?
How much of their losses are currently not
deductible by Lance and Francesca because of
the tax-basis limitation?
To what extent does the passive activity loss
limitation apply in restricting their deductible
losses for the year?
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