MEM Partners Was Formed During the Current Tax Year

question 45

Multiple Choice

MEM Partners was formed during the current tax year.It incurred $20,000 of organizational expenses,$100,000 of startup expenses,and $200,000 of syndication costs.Which of the following statements is correct regarding these payments?

• A)MEM may deduct $5,000 of the syndication costs;the remaining amount must be amortized.
• B)MEM must amortize the $20,000 of organizational expenses over 180 months.
• C)MEM's startup expenses are amortized over 60 months.
• D)MEM must file an election to deduct and/or amortize its organizational expenses,startup costs,and syndication costs.
• E)None of the above statements are true.

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Definitions:

Standard Deviation

A measure of the amount of variation or dispersion of a set of values.

Correlational Coefficient

A statistical measure that indicates the extent to which two or more variables fluctuate together, showing the direction and strength of a relationship between variables.

Error

A mistake made in thinking or action that leads to incorrect or unintended results.

Negative Correlation

A relationship between two variables in which one variable increases as the other decreases, indicating an inverse association.