Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Dre and Bow are a wealthy couple. Dre works full-time in a marketing partnership. In the past he has contributed $100,000 of cash and property

Dre and Bow are a wealthy couple. Dre works full-time in a marketing partnership. In the past he has contributed $100,000 of cash and property with a FMV of $75,000 and a basis of $25,000. In first 5 years of the partnership Dres share of the income was $35,000. However, since then there has been a string of losses. In the next few years Dres share of losses totaled $125,000. 2017 was a rough year and Dres share of loss from the partnership is $65,000.

Bow makes $375,000 in her job as an anesthesiologist. She also has invested wisely and her investments paid $38,000 in dividends and $47,000 in interest during 2017. Her investments also include a partnership, she doesnt work for this partnership in any capacity. She contributed $75,000 to the partnership in cash as her original investment. Since then, her share of the income generated by the partnership is $40,000. In 2017, her income from the partnership was $5,000.

In 2018 Bows salary remains $375,00 and her investments generate $41,000 in dividends and $47,000 in interest. However, her partnership generated a loss of $5,000. Dres partnership turned things around and his share of the income was $22,000. Assuming no other items, what is Bow and Dres AGI for 2018?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managerial Accounting

Authors: Hartgraves And Morse

6th Edition

1934319805, 978-1934319802

More Books

Students also viewed these Accounting questions

Question

What is management growth? What are its factors

Answered: 1 week ago