Yee manages Huang real estate,a partnership in which she is also a partner.She receives 40% of all partnership income before guaranteed payments,but no less than $80,000 per year.In the current year,the partnership reports $400,000 in ordinary income.What is Yee's distributive share and her guaranteed payment?

Question

Quizplus · Accepted Answer

Yee's distributive share = 40% of partnership income = 0.4 x $400,000 = $160,000
Yee's guaranteed payment = minimum of $80,000 or 40% of partnership income before guaranteed payments = $80,000 (because $80,000 is greater than 40% of $400,000)

Yee Manages Huang Real Estate,a Partnership in Which She Is