Cornell and Joe Are Equal Partners in Jones Company In Addition to His Jones Earnings,Joe Has Other Net Taxable

question 93

Multiple Choice

Cornell and Joe are equal partners in Jones Company.For the current year,Jones reports the following items of income and expense:
$\begin{array}{lr}\text { Sales revenues } & \$ 500,000 \\\text { Long-term capital gains } & 14,000 \\\text { Short-term capital losses } & (30,000) \\\text { Trade and business expenses } & (200,000) \\\text { Limited partnership loss } & (50,000) \\\text { Taxable income } & \$ 234,000\end{array}$
In addition to his Jones earnings,Joe has other net taxable income of $45,000.Included in the $45,000 is $10,000 in income from a passive activity.Joe's income is:

• A)$152,000
• B)$157,000
• C)$162,000
• D)$167,000
• E)$182,000

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Definitions:

Liabilities

Financial obligations or debts owed by a business to another entity, payable in money, goods, or services.

Notes Payable

Refers to promissory notes a company issues, promising to pay a specific amount of money at a future date.

Salaries

Regular payments made to employees for their services, often expressed as an annual amount but payable in smaller increments such as monthly or biweekly.

Accounts Payable

Obligations owed by a company to suppliers or creditors for goods and services received but not yet paid for.