Purchase Solution

Partnership Accounting and Taxation

Not what you're looking for?

Ask Custom Question

EZ Manufacturing Company is a partnership among Yolando Gonzales, Willie Todd and Linda Yeager. The partnership contract states that partnership profits will be split equally among three partners. During the current year Gonzales withdrew $25,000, Todd withdrew $23,000 and Yeager withdrew $30,000. Net income of E-Z manufacturing company is $180,000.

a. Calculate each partner's share of net income for the period.
b. Describe the effects, if any, that partnership operations would have on the individual tax returns of the partners.
c. Prepare a statement of partners' equity for the year. Assume that partners' capital accounts had beginning balances of $50,000, $60,000 and $40,000 for Gonzales, Todd and Yeager.

Purchase this Solution
Solution Summary

This solution illustrates how to calculate each partner's share in net income and its effect on their tax returns, and to prepare a statement of partners' equity.

Solution Preview

Please see the attached Excel 97-2003 spreadsheet for format and formulas.

EZ Manufacturing Company is a partnership among Yolando Gonzales, Willie Todd and Linda Yeager.Ã? Ã? The partnership contract states that partnership profits will be split equally among three partners.Ã? Ã? During the current year Gonzales withdrew $25,000, Todd withdrew $23,000 and Yeager withdrew $30,000.Ã? Ã? 

Net income of E-Z manufacturing company is $180,000.

a. Calculate each partner's share of net income for the ...

Purchase this Solution
Free BrainMass Quizzes
Business Ethics Awareness Strategy

This quiz is designed to assess your current ability for determining the characteristics of ethical behavior. It is essential that leaders, managers, and employees are able to distinguish between positive and negative ethical behavior. The quicker you assess a person's ethical tendency, the awareness empowers you to develop a strategy on how to interact with them.

Basics of corporate finance

These questions will test you on your knowledge of finance.

Change and Resistance within Organizations

This quiz intended to help students understand change and resistance in organizations

Motivation

This tests some key elements of major motivation theories.

Production and cost theory

Understanding production and cost phenomena will permit firms to make wise decisions concerning output volume.

View More Free Quizzes
Related BrainMass Solutions

  • Taxation: Why are certain pass-through items separately stat

    428798 Taxation: Why are certain pass-through items separately stated? Could you please help me with the following accounting/taxation question?: Why are certain pass-through items separately stated? Thank you for using BrainMass.com.

  • Partnership Start-Up

    208669 Taxation: R & R Partnership, classify expenses, deduction in first year On July 1 of the current year, the R & R Partnership was formed to operate a bed and breakfast inn.

  • Three advantages of an S Corp. over a Partnership

    As compared to partnership, S Corp limits the business liability. For example, the S Corp reduces the risk of the business ii. Tax accounting is easier for S Corp as compared to partnership.

  • Accounting - Taxation for sale of partnership interest

    125175 Accounting - Taxation for sale of a partnership interest Roberta Wynn has been a partner in the Cato partnership for a number of years. With the permission of the other partners, she sells her partnership interest to a third party.

  • Review of basic tax laws for partnership, C & S corporation

    Other features of LLCs are more like a partnership, providing management flexibility and the benefit of pass-through taxation.

  • Business Structure from a Tax Perspective

    Moreover, the taxation rules applicable to S Corporation are very complex and lead to high tax preparation and accounting costs. S Corporations have to do elaborate preparation of filing of tax return.

  • Business Structures for CPA Businesses

    Other features of LLCs are more like a partnership, providing management flexibility and the benefit of pass-through taxation. Owners of an LLC are called members.

  • US businesses Vs. Foreign businesses.

    With regard to taxation, financial disclosure, and ownership structure, every country has its own set of rules and regulations.

  • Principles of Accounting and Business Entities

    Sole Proprietorship-single owner, unlimited liabilty, easy to open and close, hard to run and be successful Partnership-two or more people working together; sometimes both involved in management; sometimes one is manager-one is financial; unlimited liability

  • Explaining the Components of a Report, Recommendations and Justification

    General Partnership Profits and liability are described. Please clarify or discuss four additional characteristics of a general partnership: control, longevity, taxation, location or convenience.

View More Related Solutions