Bevo Partnership had the following financial activity for the year:
$\begin{array}{lr}
\text {Gross recelpts from sales }&\$860,000\
\text {Cost of goods sold }&(390,000)\
\text {Operating expenses }&(180,000)\
\text {Business meals }&(20,000)\
\text {Section 1231 gain on equipment sale }&5,000\
\text {Distribution to partners }&(75,000)\
\end{array}$
Compute Bevo's ordinary business income for the year and indicate which items must be separately stated.

Question

Bevo Partnership had the following financial activity for the year:
 $\begin{array}{lr}
\text {Gross recelpts from sales }&\$860,000\
\text {Cost of goods sold }&(390,000)\
\text {Operating expenses }&(180,000)\
\text {Business meals }&(20,000)\
\text {Section 1231 gain on equipment sale }&5,000\
\text {Distribution to partners }&(75,000)\
\end{array}$
 Compute Bevo's ordinary business income for the year and indicate which items must be separately stated.

Quizplus · Accepted Answer

The Answer of Bevo Partnership had the following financial activity for the year:
 $\begin{array}{lr}
\text {Gross recelpts from sales }&\$860,000\
\text {Cost of goods sold }&(390,000)\
\text {Operating expenses }&(180,000)\
\text {Business meals }&(20,000)\
\text {Section 1231 gain on equipment sale }&5,000\
\text {Distribution to partners }&(75,000)\
\end{array}$
 Compute Bevo's ordinary business income for the year and indicate which items must be separately stated.

Bevo Partnership Had the Following Financial Activity for the Year