Pam and Susan own the PS Partnership. Pam takes care of daily operations and receives a guaranteed payment for her efforts. What amount and character of income will each partner report in each of the following independent situations?
a. The PS Partnership reports a $10,000 long-term capital gain and no ordinary income. Pam receives a $40,000 guaranteed payment plus a 30% distributive share of all partnership income after deducting the guaranteed payment.
b. The PS Partnership reports $80,000 of ordinary income, before considering any guaranteed payment, and a $60,000 Sec. 1231 gain. Pam receives a $35,000 guaranteed payment plus a 20% distributive share of all partnership income after deducting the guaranteed payment.
c. The PS Partnership reports $120,000 of ordinary income before considering any guaranteed payment. Pam receives 40% of partnership income but no less than $60,000.