Kristie Is a 30% Partner in the KKM Partnership

question 145

Multiple Choice

Kristie is a 30% partner in the KKM Partnership. During the current year, KKM reported gross receipts of $280,000 and a charitable contribution of $30,000. The partnership paid office expenses of $80,000. In addition, KKM distributed $20,000 each to partners Kaylyn and Megan, and the partnership paid partner Kaylyn $20,000 for administrative services. Kristie reports the following income from KKM during the current tax year:

• A) $54,000 ordinary income? $9,000 charitable contribution.
• B) $60,000 ordinary income? $9,000 charitable contribution.
• C) $36,000 ordinary income.
• D) $54,000 ordinary income.
• E) None of the above is correct.

Distinguish between illusory promises and conditional promises in the context of contract enforceability.

Evaluate the legal validity of exclusive dealing contracts and requirements contracts.

Recognize contracts that are binding without consideration, including their exceptions under specific circumstances.

Understand the implications of a preexisting duty rule on contract modifications and promises.

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Definitions:

Income

Earnings received by an individual or entity, usually through work, investments, or business operations, over a specified period.

Third Parties

Political parties in the United States other than the two dominant ones, the Democrats and Republicans, often focusing on specific issues.

Extremist Religious Groups

Religious factions holding radical views or beliefs that are far removed from the mainstream interpretations of their faith.

Recent Immigrants

Individuals who have moved to a new country from their home nation, typically within the last few years, to live permanently.