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ACC445 Phoenix Week 3 Accounting Corporate Tax Lab Report

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1 C:9.1-2 Identify which of the following statements is true. A. An individual engaged in the active conduct of a business must elect not to be taxed as a partnership. B. Formation of a partnership requires legal documentation. C. A partnership exists as long as there are at least two individuals or entities engaged in the active conduct of a trade or business or a financial operation, and the business is not a trust or a corporation. Your answer is correct. D. All of the above are false. C:9.1-4 Identify which of the following statements is true. A. All of the partners in a limited partnership have limited liability. B. A limited partnership must have at least two general partners. C. A limited partnership cannot have a corporate general partner. D. All of the above are false. C:9.2-3 Identify which of the following statements is true. A. Distribution of partnership income in the form of cash to partners is generally tax-free to the partners and the partnership. Your answer is correct. B. TAX POSITION PAPER 2 If money distributions exceed the partner's basis in the partnership interest, the partner would have to recognize gain on the distribution from the partnership. Such gain is usually an ordinary gain. C. When partners receive cash distributions from the partnership, they pay taxes on those distributions. D. All of the above are true. C:9.2-4 George pays $10,000 for a 20% interest in a general partnership, which has recourse liabilities of $20,000. The partners s ...
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