Which of the Following Statements Exemplifies the Entity Theory of Partnership

question 6

Multiple Choice

Which of the following statements exemplifies the entity theory of partnership taxation?

• A)Partnerships are taxable entities.
• B)Partnerships determine the character of separately stated items at the partnership level.
• C)Partnerships make the majority of the tax elections.
• D)Both partnerships are taxable entities and partnerships make the majority of the tax elections.
• E)Both partnerships determine the character of separately stated items at the partnership level and partnerships make the majority of the tax elections.

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Definitions:

Auction Without Reserve

A type of auction in which the item for sale will be sold regardless of the bid amount, without any minimum price threshold.

Cash Register

A machine used in shops to calculate and record sales transactions and to store money.

Expressed Contract

A legally binding agreement where the terms are explicitly stated either orally or in writing.

Hula Hoop

A toy hoop that is twirled around the waist, limbs, or neck, primarily for exercise or entertainment.