BRW Partnership reported gross income from operations of $60,000, interest income of $3,000, utilities expense of
$20,000, and a charitable contribution of $6,000. On its Schedule K, the partnership reports ordinary business income of $40,000, separately stated interest income ($3,000), and charitable contributions ($6,000).

Question

Quizplus · Accepted Answer

The ordinary business income of $40,000 is calculated by subtracting the utilities expense ($20,000) from the gross income from operations ($60,000), and the interest income ($3,000) and charitable contributions ($6,000) are reported separately, as per the tax reporting requirements for partnerships.

BRW Partnership Reported Gross Income from Operations of $60,000, Interest