Problem 09-61 (LO 09-4) (Algo) The partnership agreement of the G&P general partnership states that...
50.1K
Verified Solution
Link Copied!
Question
Accounting
Problem 09-61 (LO 09-4) (Algo)
The partnership agreement of the G&P general partnership states that Gary will receive a guaranteed payment of $15,100, 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
$ 89,500
Gain on sale of land (1231)
7,850
Cost of goods sold
(45,700)
DepreciationMACRS
(14,400)
Employee wages
(20,900)
Cash charitable contributions
(3,700)
Municipal bond interest
3,700
Other expenses
(4,800)
Note: Negative amounts should be indicated by a minus sign.
Problem 09-61 Part a (Algo)
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.
c. What do you believe Gary's share of self-employment income (loss) to be reported on his year 1 Schedule K-1 should be, assuming G&P is an LLC and Gary spends 2,000 hours per year working there full-time?
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
