Cornell and Joe are equal partners in Jones Company. For the current year, Jones
ID: 2523090 • Letter: C
Question
Cornell and Joe are equal partners in Jones Company. For the current year, Jones reports the following items of income and expense:
Sales revenues $500,000
Long-term capital gains 14,000
Short-term capital losses (30,000)
Trade and business expenses (200,000)
Limited partnership loss (50,000)
Taxable income $234,000
In addition to his Jones earnings, Joe has other net taxable income of $45,000. Included in the $45,000 is $10,000 in income from a passive activity. Joe's income is:
Cornell and Joe are equal partners in Jones Company. For the current year, Jones reports the following items of income and expense:
Sales revenues $500,000
Long-term capital gains 14,000
Short-term capital losses (30,000)
Trade and business expenses (200,000)
Limited partnership loss (50,000)
Taxable income $234,000
In addition to his Jones earnings, Joe has other net taxable income of $45,000. Included in the $45,000 is $10,000 in income from a passive activity. Joe's income is:
Explanation / Answer
Answer) 162,000
Note: As Cornell and Joe are equal partners in the company, so taxable income will be divided equally among them. Joe’s taxable income will be $ 117,000(234000/2) also include other net taxable income and income from a passive activity, which are $ 35,000 and $ 10000. So the total taxable income of Joe will be 162,000.