Matt and Joel Are Equal Partners in the MJ Partnership

question 73

Multiple Choice

Matt and Joel are equal partners in the MJ Partnership. For the current year ended December 31, the partnership has book income of $80,000, which includes the following deductions: (1) guaranteed payments (salaries) to partners: Matt, $35,000; and Joel, $25,000; and (2) charitable contributions, $6,000. The book income amount does not include any sales of capital assets or Sec. 1231 assets or any tax- exempt income. Based on the above information, what amount should be reported as ordinary income on the partnership return?

• A) $80,000
• B) $140,000
• C) $86,000
• D) $60,000

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Definitions:

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Object permanence is the understanding that objects continue to exist even when they cannot be observed (seen, heard, touched, smelled, or sensed in any way).

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Reminder Sessions

are designed appointments or periods set to review or reinforce previously learned information or skills.

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