What result to c, d, and cd

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Question - The CD equal partnership is in a highly speculative business in which profits fluctuate widely. For the current year the partnership has profits of $80,000 of which $48,000 is ordinary income and $32,000 is long term capital gain. C and D share profits and losses equally unless otherwise provided. C renders services to the partnership which are continuous, related to the function of the partnership and not in the nature of a capital expenditure.

(a) What result to C, D, and CD, if C worked for the partnership and was required to be paid $60,000 per year for her services regardless of the income of the partnership?

(b) What result (a) above if C's services relate to improvements on land owned by the partnership?

Reference no: EM132605623

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