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A and B each contribute $50,000 in cash to the AB partnership

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Question;A and B each contribute $50,000 in cash to the AB partnership. The partnership has the following transactions this year:- Sales: $250,000 - COGS: $100,000 - Interest income: $5,000- Rent Expense: $50,000 - Wages paid: $40,000 - Advertising Expense: $15,000- Depreciation Exp: $15,000 - Charitable Contrib: $5,000 - Maintenance Exp: $10,000In addition, the partnership took a bank loan of $100,000, and it also made a cash distribution of $35,000 to each partner. Assuming that A and B are equal partners, please determine (1) A?s basis in her partnership interest at the end of the year, (2) A?s partner capital at the end of the year. In addition, please determine what A?s basis would have been if the AB partnership had instead been organized as an S Corporation.************************************ACC 430Quiz #4Name:______________________________A and B each contribute $50,000 in cash to the AB partnership. The partnership has the following transactions this year:-Sales: $250,000Rent Expense: $50,000Depreciation Exp: $15,000- COGS: $100,000- Wages paid: $40,000- Charitable Contrib: $5,000- Interest income: $5,000- Advertising Expense: $15,000- Maintenance Exp: $10,000In addition, the partnership took a bank loan of $100,000, and it also made a cash distribution of $35,000 to each partner. Assumingthat A and B are equal partners, please determine (1) A?s basis in her partnership interest at the end of the year, (2) A?s partner capitalat the end of the year. In addition, please determine what A?s basis would have been if the AB partnership had instead been organizedas an S Corporation.

 

Paper#39991 | Written in 18-Jul-2015

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