Fasta Partnership, LP Year Ended December 31, Year 3 Adjusted Tax Trial Balance Dear CPA: Enclosed is a copy of our tax basis trial balance as of December 31 , Year 3 . All book/tax differences have been properly reflected. The following information relates to transactions that occurred during Year 3 : - On December 31, Year 3, Judith Smith loaned Fasta $15,000. Interest on the loan is calculated at a market rate. - On July 1, Year 3, Fasta borrowed $50,000 from Midland Bank to purchase equipment. The loan has a 10-year term, and interest is calculated at a market rate. Payments are due monthly and began on September 1 , Year 3. Based on the loan documents, this is a recourse liability. - Depreciation expense has been calculated using MACRS. In addition, Fasta decided not to elect a Section 179 deduction for Year 3. - Interest income of $1,000 was received on Fasta's savings account throughout the year. Please contact me if you have any additional questions regarding the trial balance. Sincerely, Thomas Green Thomas Green Fasta Partnership, LP General Partner Green, the general partner, has a 6096 ownership interest and actively participates in the management of the business on a daily basis. Green bears the economic risk of loss relating to all of Fasta's outstanding liabilities, except for Fasta's loan payable to Smith. Smith, the limited partner, has a 4096 ownership interest and does not actively participate in the operations of the partnership. Smith is not obligated to restore any negative capital accounts upon liquidation of the partnership. A letter from Green and a copy of Fasta's adjusted tax trial balance for the year ended December 31, Year 3, can be found in the exhibits. For each item requested below, enter the applicable amount in the appropriate cell as a positive, whole value. If a response is zero, enter a zero (0). Fasta Partnership, LP Year Ended December 31, Year 3 Adjusted Tax Trial Balance Dear CPA: Enclosed is a copy of our tax basis trial balance as of December 31 , Year 3 . All book/tax differences have been properly reflected. The following information relates to transactions that occurred during Year 3 : - On December 31, Year 3, Judith Smith loaned Fasta $15,000. Interest on the loan is calculated at a market rate. - On July 1, Year 3, Fasta borrowed $50,000 from Midland Bank to purchase equipment. The loan has a 10-year term, and interest is calculated at a market rate. Payments are due monthly and began on September 1 , Year 3. Based on the loan documents, this is a recourse liability. - Depreciation expense has been calculated using MACRS. In addition, Fasta decided not to elect a Section 179 deduction for Year 3. - Interest income of $1,000 was received on Fasta's savings account throughout the year. Please contact me if you have any additional questions regarding the trial balance. Sincerely, Thomas Green Thomas Green Fasta Partnership, LP General Partner Green, the general partner, has a 6096 ownership interest and actively participates in the management of the business on a daily basis. Green bears the economic risk of loss relating to all of Fasta's outstanding liabilities, except for Fasta's loan payable to Smith. Smith, the limited partner, has a 4096 ownership interest and does not actively participate in the operations of the partnership. Smith is not obligated to restore any negative capital accounts upon liquidation of the partnership. A letter from Green and a copy of Fasta's adjusted tax trial balance for the year ended December 31, Year 3, can be found in the exhibits. For each item requested below, enter the applicable amount in the appropriate cell as a positive, whole value. If a response is zero, enter a zero (0)
