What amount of expense will Sigma recognize

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Question - Organization and Syndication - The sigma-limited partnership was organized during May and June of the current year. During these two months, the partnership paid 30,000 to a law company to draft the partnership agreement and 10,000 to CPA to set up an accounting system for the business. The partnership also paid a 2,500 filing fee to the state of California. Sigma began business in August of the current year and properly adopted a fiscal year ending Dec 31 for tax purposes.

a) Based on the facts above, what portion of the above expenses may be expensed and amortized on Sigma's first form 1065?

b) What amount of expense will Sigma recognize and how much will be amortized for the first year if the amount paid to the law company was 40,000 instead of 30,000?

Reference no: EM133125561

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