John and Saah met at law school and decide to start a small law practice after graduation. They agree to split revenues and expenses evenly The most common form of business
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- Yash and Ankita decided to invest money in this joint venture, which they called Alkaline. Both of them invested *1,50,000 each in the company on 1st April. After the investment, they used the money from the company to buy a website domain name on the internet for alkaline.com from GoDaddy.com on 3rd April. This cost them 3,000. Since they both decided to work from home, there was no point in renting out an office space just yet. However, the production of beauty products would require a factory of sorts. Since they were just starting out, they rented half a floor of an already operating factory on the 5th of April for ₹16,000 per month from Mr Bhuvan. Their next order of business was to procure raw materials to manufacture the beauty products. They drove across town and met various vendors to get the cheapest deal available. Because they did not want to get all their raw materials from different places, they compromised on the price a little and bought all the raw materials from one…Reed, Isaiah, Nia, and Taylor are all lawyers. After several years of working for big firms, they decide to pool their resources and start their own law practice together. The four of them will make all their business decisions together and will share all of the profits and financial risk. Their new law firm is an example of which business organization? A. Franchise B. Corporation C. Sole Proprietorship D. PartnershipMaria and Javier are the equal partners in MarJa, a partnership that is a qualified trade or business. In the current year, Marja had $328,200 of ordinary income after reporting $393,840 in guaranteed payments to Maria and Javier for their services to MarJa ($196,920 each). a. What is Maria's and Javier's qualified business income? b. What is Maria's and Javier's qualified business income if MarJa had $459,480 of ordinary income after reporting $196,920 in guaranteed payments to Maria and Javier ($98,460 each)?
- Roland Go, Gina Go, and Mia Ting organized a partnership and they named it as HO-TING Partnership. After 5 years of operation, Mia Ting met an accident and died. Roland Go and Gina Go continued the operation of the business. They still retained the name GO-TING Partnership. Is the name of the partnership allowed by law despite the death of Mia? Yes or No? Explain.Tanner and Teresa share income and losses in a 2:1 ratio (2/3 to Tanner and 1/3 to Teresa) after allowing for salaries of $39,900 to Tanner and $57,000 to Teresa. Net income of the partnership is $131,400. How should income be divided for Tanner and Teresa? Oa. Tanner, $62,900; Teresa, $68,500 Ob. Tanner, $58,900; Teresa, $72,500 Oc. Tanner, $57,900; Teresa, $73,500 Od. Tanner, $73,500; Teresa, $57,900Fitzee, Chesher and Klotia have a partnership. They share income on the basis of the following ratio: 2:3:5. Each partner has the following capital balances respectively $220,000, $250,000, and $145,000. They decided to liquidate their business on July 3 because they wanted to pursue other interests. They had a big liquidation sale and they sold all non-cash assets for $445,000. They have the following accounts: Cash $200,000 Supplies $50,000 Equipment $150,000 Truck $65,000 Building $300,000 AP $200,000 Prepare all of the journal entries to close this business General Journal Page Date Particulars PR Debits Credits
- Cody Jenkins and Lacey Tanner formed a partnership to provide landscaping services. Jenkins and Tanner shared profits and losses equally. After all the tangible assets have been adjusted to current market prices, the capital accounts of Cody Jenkins and Lacey Tanner have balances of $78,000 and $46,000, respectively. Valeria Solano has expertise with using the computer to prepare landscape designs, cost estimates, and renderings.Jenkins and Tanner deem these skills useful; thus, Solano is admitted to the partnership at a 30% interest for a purchase price of $32,000.a. Determine the recipient and amount of the partner bonus.b. Provide the journal entry to admit Solano into the partnership.c. Why would a bonus be paid in this situation?Lamiya and Ghaniya decided to undertake a venture jointly. They maintained a separate set of books. They agreed to share profits & losses in the ratio of 3: 2.Lamiya supplied from her own stock goods worth $ 200,000 and paid $ 4,950 for freight and $ 1,200 for Sundry Expenses. Ghaniya purchased goods of $ 195,000 for the venture and paid 7,000 for selling expenses. Ghaniya sold all the goods for $ 500,000. At the end of the venture, the accounts were settled. Show Joint Venture AccountJesse and Tim form a partnership by combining the assets of their separate businesses. Jesse contributes accounts receivable with a face amount of $50,000 and equipment with a cost of $185,000 and accumulated depreciation of $101,000. The partners agree that the equipment is to be valued at $67,800, that $4,000 of the accounts receivable are completely worthless and are not to be accepted by the partnership, and that $1,800 is a reasonable allowance for the uncollectibility of the remaining accounts receivable. Tim contributes cash of $21,500 and merchandise inventory of $45,000. The partners agree that the merchandise inventory is to be valued at $48,500. Journalize the entries in the partnership accounts for (a) Jesse's investment and (b) Tim's investment. If an amount box does not require an entry, leave it blank. a. b.
- The TimpRiders LP has operated a motorcycle dealership for a number of years. Amir 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, Amir and Francesca had bases of $11,900 and $4,100, respectively, and the partnership did not have any liabilities. During the current year, the partnership reported the following results from operations: Net sales Cost of goods sold Operating expenses Short-term capital loss Tax-exempt interest §1231 gain On the last day of the year, the partnership distributed $4,100 each to Amir and Francesca. $ 684,000 511,000 186,000 Comprehensive Problem 09-81 Part 1 (Algo) a. Year-end basis b. Loss limited by tax basis c. Loss limited by passive activity 2,800 3,100 7,100 Required: a. What outside basis do Amir and Francesca have in their partnership interests…Together, Mr. and Mrs. Beck, who file jointly, own and operate an assisted-living facility in their home using the extra bedrooms. They provide maid service and meals in a common dining room. Where do they report the income and expenses from this activity?Phillips and Harris are partners in a used car business. Under their oral partnership, each has an equal voice in the conduct and management of the business. Because of their irregular business hours, the two further agreed that they could use any partnership vehicle as desired. This use includes transportation to and from work, even though the vehicles are for sale at all times. Harris conducted partnership business both at the used car lot and from his home. He was on call by Phillips or customers at his home, and he went back to the lot two or three times after going home. While driving a partnership vehicle home from the used car lot, Harris negligently hit a car driven by Cook, who brought this action against Harris and Phillips individually and as copartners for his injuries. Who is liable?