Bean and D. Counter formed a partnership. During the current year, the partnership had the following income and expenses: Gross income from operations $135,000 Gain on sale of antique abacus (a business asset) 4,000 Interest income from business bank account 100 Deductions: Salaries to employees $65,000 Payroll taxes 5,000 Rent 8,000 Depreciation 3,500 Contribution to United Way charity 2,000 Foreign tax paid on overseas business deals 3,000 Distributions to the partners $40,000 Calculate the net ordinary income. List all of the other items that need to be separately reported. If the partnership is on a calendar year tax basis, when is the partnership tax return due?
Bean and D. Counter formed a partnership. During the current year, the partnership had the following income and expenses: Gross income from operations $135,000 Gain on sale of antique abacus (a business asset) 4,000 Interest income from business bank account 100 Deductions: Salaries to employees $65,000 Payroll taxes 5,000 Rent 8,000 Depreciation 3,500 Contribution to United Way charity 2,000 Foreign tax paid on overseas business deals 3,000 Distributions to the partners $40,000 Calculate the net ordinary income. List all of the other items that need to be separately reported. If the partnership is on a calendar year tax basis, when is the partnership tax return due?
Chapter20: Corporations And Parterships
Section: Chapter Questions
Problem 6BCRQ
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Question
- Bean and D. Counter formed a
partnership . During the current year, the partnership had the following income and expenses:
|
Gross income from operations |
$135,000 |
|
Gain on sale of antique abacus (a business asset) |
4,000 |
|
Interest income from business bank account |
100 |
|
Deductions: |
|
|
Salaries to employees |
$65,000 |
|
Payroll taxes |
5,000 |
|
Rent |
8,000 |
|
|
3,500 |
|
Contribution to United Way charity |
2,000 |
|
Foreign tax paid on overseas business deals |
3,000 |
|
Distributions to the partners |
$40,000 |
- Calculate the net ordinary income.
List all of the other items that need to be separately reported.
If the partnership is on a calendar year tax basis, when is the partnership tax return due?
Expert Solution
Step 1
Step 2
1.
2.
Items that are to reported separately are;
- Gain on Antique abacus as it is a capital gain.
- Income from bank as interest income.
- Charitable contribution.
- Foreign tax paid as tax credits.
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