Roger is a 30% partner in the Roc Partnership. At the beginning of the tax year, Roger's basis in the partnership interest was $60,000, including his share of partnership liabilities. During the current year, Roc reported an ordinary income of $40,000. In addition, Roc distributed $5,000 to each of the partners ($15,000 total). At the end of the year, Roger's share of partnership liabilities increased by $20,000. Roger's basis in the partnership interest at the end of the year is: a. $60,000 b. $75,000 c. $87,000 d. $120,000 e. none of the above
Roger is a 30% partner in the Roc Partnership. At the beginning of the tax year, Roger's basis in the partnership interest was $60,000, including his share of partnership liabilities. During the current year, Roc reported an ordinary income of $40,000. In addition, Roc distributed $5,000 to each of the partners ($15,000 total). At the end of the year, Roger's share of partnership liabilities increased by $20,000. Roger's basis in the partnership interest at the end of the year is: a. $60,000 b. $75,000 c. $87,000 d. $120,000 e. none of the above
Chapter14: Choice Of Business Entity—operations And Distributions
Section: Chapter Questions
Problem 21P
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Roger is 30% patner in the roc
Transcribed Image Text:Roger is a 30% partner in the Roc Partnership. At the beginning of
the tax year, Roger's basis in the partnership interest was $60,000,
including his share of partnership liabilities. During the current year,
Roc reported an ordinary income of $40,000. In addition, Roc
distributed $5,000 to each of the partners ($15,000 total). At the end
of the year, Roger's share of partnership liabilities increased by
$20,000. Roger's basis in the partnership interest at the end of the
year is:
a. $60,000
b. $75,000
c. $87,000
d. $120,000
e. none of the above
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