A Partner Had the Following Items Reported on a Partnership

question 14

Multiple Choice

A partner had the following items reported on a partnership Schedule K-1: $\begin{array}{lr}\text { Ordinary income }&\$27,000\\\text { Interest income } & 4,500 \\\text { Dividend income } & 2,000 \\\text { Guaranteed payment } & 15,000 \\\text { Section 179 expense } & 16,000\end{array}$ The partner's self-employment income for the year is:

• A)$26,000.
• B)$32,500.
• C)$48,500.
• D)$64,500.

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Definitions:

Fiduciary Duty

A legal obligation of one party to act in the best interest of another when entrusted with particular responsibilities, common in relationships such as trustee and beneficiary, or agent and principal.

Federal Government

The national government of a federated country, where powers are divided between central federal authorities and various constituent regions or states.

Principle of Ratification

The acceptance and confirmation by a principal of an act performed on their behalf by another, who didn't have the authority to act in the first place.

Injustice

A situation or action that violates the principles of fairness, ethics, or rights, leading to perceived or actual harm.