Nicole, Olivia and Penielle formed a partnership and agreed to a profit/loss ratio of 1:1:1. At the end of the year, the capital balance of Nicole is P 80,000 and P 70,000 for Olivia. Penielle has no capital balance because she is an industrial partner. After a year of operations, the partnership incurred a loss of P 45,000. How much is the share of Olivia in the loss? A. P 21,000 B, P 15,000 C. P 24,000 D. P 0

Nicole, Olivia and Penielle formed a partnership and agreed to a profit/loss ratio of 1:1:1. At the end of the year, the capital balance of Nicole is P 80,000 and P 70,000 for Olivia. Penielle has no capital balance because she is an industrial partner. After a year of operations, the partnership incurred a loss of P 45,000. How much is the share of Olivia in the loss? A. P 21,000 B, P 15,000 C. P 24,000 D. P 0

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter10: Partnership Taxation

Section: Chapter Questions

Problem 17MCQ: Kendra is an attorney and owns 60 percent of a law partnership. Kendra sells land to the partnership...

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The partnership of Michelle, Amal, and Maureen has done well. The three partners have shared profits and losses in a 1:3 ratio, with capital balances of $60,000 each. Maureen wants to retire and withdraw. Prepare a schedule showing how the cost should be divided if Amal and Michelle decide to pay Maureen $70,000 for retirement of her capital account and the new agreement will share profits and losses 50:50.
Kendra is an attorney and owns 60 percent of a law partnership. Kendra sells land to the partnership for $50,000 in the current tax year. She bought the land for $100,000 eight years ago when real estate prices were at their peak. How much gain or loss must Kendra recognize on the land sale to the partnership? No gain or loss $30,000 loss $50,000 loss $50,000 short-term capital loss, limited to $3,000 allowed per year
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Chani contributes equipment to a partnership that she purchased 2 years ago for $10,000. The current book value is $7,500 and the market value is $9,000. At what value should the partnership record the equipment? A. $10,000 B. $9,000 C. $7,500 D. none of the above
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