How should jim treat he received

Assignment Help Accounting Basics
Reference no: EM133118724

Question - Jim is a retired partner of HIJ Company, a personal service partnership that has no capital assets. Jim has not rendered any services to HIJ since his retirement in 2012. Under the provisions of Jim's retirement agreement, HIJ is obligated to pay him 10% of the partnership's net income each year. In compliance with this agreement, HIJ paid Jim $20,000 in 2020. The partnership earned only ordinary income during 2020. For tax purposes, how should Jim treat the $20,000 he received?

A. Long-term capital gain.

B. Ordinary income.

C. Not taxable.

D. Short-term capital gain.

Reference no: EM133118724

Questions Cloud

Assumption of quarterly payments : (a) What is the price of a 10 year bond (annual payments) with a coupon rate of 6% if the market rates are 8%? Is the bond selling at a premium or discount?
How much will he contribute into the canada pension plan : Roberto earns an annual salary of $83,600 per year as a manager at an information technology company. How much will he contribute into the Canada Pension Plan
How many years will it take : How many years will it take for a $100 investment today to grow to $200 if the interest rate is 5% annually?
Compute maximum monthly mortgage : Bob and Sally Smith are recently married both age 30 and they want to purchase a house in Nanaimo. They have gross salaries of $55,000 and $65,000 respectively
How should jim treat he received : The partnership earned only ordinary income during 2020. For tax purposes, how should Jim treat the $20,000 he received
Building the new warehouse : 1. GroRight Inc. is building a new warehouse facility at a cost of $12.4 million. The CEO of the firm is quite conservative and will only go ahead with this pro
What inventory balance should ferret report : The relative cost index for this inventory in 2019 was 1.05. What inventory balance should Ferret report on its 12/31/19 balance sheet
Expected return on the market portfolio : The risk-free rate is 5%, the beta of Stock A is 1.2, the beta of Stock B is 0.8, and the expected return on Stock A is 12.2%.
Case-mountain top shoppe : The Mountain Top Shoppe has sales of $512,000, ave rage accounts receivable of $31,400 and average accounts payable of $24,800. The cost of goods sold is equiva

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd