Kim Received a One-Third Profits and Capital Interest in Bright

question 125

Multiple Choice

Kim received a one-third profits and capital interest in Bright Line, LLC, in exchange for legal services she provided. In addition to her share of partnership profits or losses, she receives a $30,000 guaranteed payment each year for ongoing services she provides to the LLC. For X4, Bright Line reported the following revenues and expenses: sales-$150,000, cost of goods sold-$90,000, depreciation expense-$45,000, long-term capital gains-$15,000, qualified dividends-$6,000, and municipal bond interest-$3,000. How much ordinary business income (loss) will Bright Line allocate to Kim on her Schedule K-1 for X4?

• A)($15,000)
• B)$6,000
• C)$9,000
• D)$15,000
• E)None of the choices will be reported as ordinary business income (loss)on Schedule K-1.

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Definitions:

Random Assignment

A method used in experiments to allocate participants randomly to different groups to ensure that each group is similar at the start of the experiment.

Computer Science Field

A discipline that focuses on the study of computers, their design, and their applications, encompassing topics from software development to computational theory.

Cheryan Et Al.

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Internal operations that underlie cognitive and emotional functions such as thinking, reasoning, and feeling.