CONCEPTS IN FED.TAX.,2020-W/ACCESS
CONCEPTS IN FED.TAX.,2020-W/ACCESS
20th Edition
ISBN: 9780357110362
Author: Murphy
Publisher: CENGAGE L
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Chapter 2, Problem 80DC
To determine

State the amount of rental income does the partnership P have for the current year.

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The partnership agreement of the G&P general partnership states that Gary will receive a guaranteed payment of $19,000, and that Gary and Prudence will share the remaining profits or losses in a 45/55 ratio. For year 1, the G&P partnership reports the following results: Sales revenue $ 83,200 Gain on sale of land (§1231) 6,300 Cost of goods sold (40,700) Depreciation—MACRS (16,600) Employee wages (16,600) Cash charitable contributions (3,400) Municipal bond interest 5,600 Other expenses (4,800) Note: Negative amounts should be indicated by a minus sign.   Required: a-1. How much ordinary income (loss) is allocated to Gary for the year? a-2. Compute Gary's share of separately stated items to be reported on his year 1 Schedule K-1, including his self-employment income (loss). b. Compute Gary's share of self-employment income (loss) to be reported on his year 1 Schedule K-1, assuming G&P is a limited partnership and Gary is a limited partner. PLEASE…
Jalapeño Corporation and Habanero Corporation formed a partnership to construct a restaurant. Jalapeño contributed $567,000 cash, and Habanero contributed land ($567,000 FMV and $497,000 basis) in exchange for a 50 percent interest in Pepper Partnership. Immediately after its formation, Pepper Partnership borrowed $283,500 from a local bank. The debt is recourse (unsecured by any specific partnership asset). Required: a. Compute each partner's initial basis in its partnership interest, assuming that both Jalapeño and Habanero are general partners. b. Compute each partner's initial basis in its partnership interest, assuming that Jalapeño is a general partner, and Habanero is a limited partner.
The partnership agreement of the G&P general partnership states that Gary will receive a guaranteed payment of $14,100, and that Gary and Prudence will share the remaining profits or losses in a 45/55 ratio. For year 1, the G&P partnership reports the following results: Sales revenue Gain on sale of land (§1231) Cost of goods sold Depreciation-MACRS Employee wages Cash charitable contributions Municipal bond interest Other expenses $ 91,500 7,500 (53,500) (15,600) (11,100) (5,300) 5,450 (5,100) Note: Negative amounts should be indicated by a minus sign. Required: a-1. How much ordinary income (loss) is allocated to Gary for the year? a-2. Compute Gary's share of separately stated items to be reported on his year 1 Schedule K-1, including his self-employment income (loss). Complete this question by entering your answers in the tabs below. Required A1 Required A2 How much ordinary income (loss) is allocated to Gary for the year? Note: Round your intermediate computations to the nearest…

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