Kristie Is a 30% Partner in the KKM Partnership

question 107

Multiple Choice

Kristie is a 30% partner in the KKM Partnership. During the current year, KKM reported gross receipts of $280,000 and a charitable contribution of $30,000. The partnership paid office expenses of $80,000. In addition, KKM distributed $20,000 each to partners Kaylyn and Megan, and the partnership paid partner Kaylyn $20,000 for administrative services. Kristie reports the following income from KKM during the current tax year:

• A)$54,000 ordinary income; $9,000 charitable contribution.
• B)$60,000 ordinary income; $9,000 charitable contribution.
• C)$36,000 ordinary income.
• D)$54,000 ordinary income.
• E)None of the above.

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Definitions:

Demand for Curds

The desire and willingness of consumers to purchase curds, a dairy product, at various price levels, within a specific period.

Price of Curds

The market price at which curds, a dairy product obtained by coagulating milk, are bought and sold.

Price of Whey

Refers to the market value assigned to whey, a by-product of cheese or casein production that is used in food and supplements.

Income

The money received by an individual or household, typically on a regular basis, through work, investments, or other sources.