Donald Owns a 45% Interest in a Partnership That Earned

question 11

True/False

Donald owns a 45% interest in a partnership that earned $130,000 in the current year. He also owns 45% of the stock in a C corporation that earned $130,000 during the year. Donald received $20,000 in distributions from each of the two entities during the year. With respect to this information, Donald must report $78,500 of income on his individual income tax return for the year.

---

Definitions:

Bond Discount

The difference between the face value of a bond and its selling price, when the bond is sold for less than its face value.

Market Rate

The Market Rate is the current price or rate at which a good or service can be bought or sold in a competitive marketplace.

Issue Price

It refers to the price at which a new security, such as a bond or stock, is offered to the public for sale.