On January 2 of the Current Year, Calloway and Taylor

question 44

Multiple Choice

On January 2 of the current year, Calloway and Taylor contribute cash equally to form the CT Partnership. Calloway and Taylor share profits and losses in a ratio of 75% and 25%, respectively. The partnership's ordinary income for the year was $40,000. Calloway received a distribution of $5,000 during the year. What is Calloway's share of taxable income for the year?

• A) $20,000
• B) $10,000
• C) $30,000
• D) $5,000

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Definitions:

Food

Any nutritious substance that people or animals eat or drink, or that plants absorb, in order to maintain life and growth.

Digestive System

The digestive system is the group of organs responsible for breaking down food into nutrients, which the body uses for energy, growth, and cell repair.

Scurvy

A disease caused by a deficiency of vitamin C, characterized by swollen bleeding gums, bruising, and weakness.

Vitamin C

An essential nutrient and antioxidant found in fruits and vegetables, important for the repair of tissue and the enzymatic production of certain neurotransmitters.