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Lawyer Enrique agrees to perform services for the FGH partnership, In return Enrique receives a 3% profits and loss interest and a capital account of

Lawyer Enrique agrees to perform services for the FGH partnership, In return Enrique receives a 3% profits and loss interest and a capital account of zero.

a) Does Enrique recognize income as a result of the receipt of the profits interest? If yes, how would it be measured? If not, why not?

b) Would the answer to the previous question change (and if so how?) if in addition to the profits interest Enrique also receives a capital account of $15,000?

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