Partnership M, a law partnership, had the following items for the current year:
ID: 2530735 • Letter: P
Question
Partnership M, a law partnership, had the following items for the current year:
Income from clients
$200,000
Repairs
1,000
Depreciation
2,000
Dividends on capital stock
500
Other operating expenses
125,000
Charitable contributions
1,500
Sec. 1231 gain on sale of office furniture
1,200
Sec. 1245 gain on sale of office furniture
1,000
What is M's ordinary income?
$73,000
$72,700
$73,500
$70,500
Income from clients
$200,000
Repairs
1,000
Depreciation
2,000
Dividends on capital stock
500
Other operating expenses
125,000
Charitable contributions
1,500
Sec. 1231 gain on sale of office furniture
1,200
Sec. 1245 gain on sale of office furniture
1,000
Explanation / Answer
So, Answer is B. $ 72,700
Ordinary income ($) Income from clients 2,00,000 Sec. 1231 gain 1,200 Sec. 1245 gain 1,000 Repairs (1,000) Depreciation (2,000) Other operating expenses (1,25,000) Charitable Contribution (1,500) Total Ordinary Income 72,700