Match Each of the Following Statements with the Numbered Terms

question 35

Multiple Choice

Match each of the following statements with the numbered terms below that provide the best definition.
-Substituted

• A)Organizational choice of many large accounting firms.
• B)Partner's percentage allocation of current operating income.
• C)Might affect any two partners' tax liabilities in different ways.
• D)Partnership in which partners are liable only for any partner's malpractice.
• E)Amount that might be reported on either form 1065, page 1 or, on Schedule K.
• F)Transfer of asset to partnership followed by immediate distribution of cash to partner.
• G)Must have at least one general and one limited partner.
• H)Long-term capital gain might be recharacterized as ordinary income.
• I)All partners are jointly and severally liable for entity debts.
• J)Theory treating the partner and partnership as separate economic units.
• K)Partner's basis in partnership interest after tax-free contribution of asset to partnership.
• L)Partnership's basis in asset after tax-free contribution of asset to partnership.
• M)One way to calculate a partner's economic interest in the partnership.
• N)Owners are members.
• O)Theory treating the partnership as a collection of taxpayers joined in an agency relationship.
• P)Participates in management.
• Q)Not liable for entity debts.
• R)No correct match provided.

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Definitions:

Cash Basis

An accounting method that recognizes revenues and expenses only when cash is exchanged.

GAAP

Generally Accepted Accounting Principles; the common set of accounting standards and procedures used in the U.S. to compile financial statements.

Revenue Recognition

A principle within accounting that determines the specific conditions under which revenue is recognized or accounted for.

Overtime Wages

Additional pay granted to employees for hours worked beyond their standard scheduled hours.