"Pearl, Inc. (a C corporation), Tweety, Inc. (an S corporation), and Belinda (an individual) are going to form a partnership (Silver Partnership). The ownership interests and tax years of the partners are as follows:a partnership (Silver Partnership). The ownership interests and tax years of the partners are as follows:

PartnerPartnerBelindaBelindaPearl, Inc.Pearl, Inc.Tweety, Inc.Tweety, Inc.

The partnership expects to begin business on April 1, 2018. The partners have several issues they would The partnership expects to begin business on April 1, 2018. The partners have several issues they would like you to address.like you to address.Partnership InterestPartnership Interest A potential conflict exists among the partners regarding when the tax year should end for Silver. Belinda A potential conflict exists among the partners regarding when the tax year should end for Silver. Belinda and Pearl would like a year-end close to their own year-ends, while Tweety would like to have a June 30 and Pearl would like a year-end close to their own year-ends, while Tweety would like to have a June 30 year-end. Is this a decision Tweety can make because it owns more of the partnership than either of the year-end. Is this a decision Tweety can make because it owns more of the partnership than either of the other two partners? Is this a decision Belinda and Pearl can make because collectively they own more other two partners? Is this a decision Belinda and Pearl can make because collectively they own more of the partnership than Tweety owns?of the partnership than Tweety owns?25%25%35%35%40%40% Because Silver will begin business on April 1, 2018, will the first tax year be a short tax year or a long Because Silver will begin business on April 1, 2018, will the first tax year be a short tax year or a long Tax Year EndsTax Year EndsDecember 31December 31November 30November 30June 30June 30tax year? Will annualization of the net income of the partnership be required?tax year? Will annualization of the net income of the partnership be required? How will the partners know when their share of Silvers net income or net loss should be reported on How will the partners know when their share of Silvers net income or net loss should be reported on their respective income tax returns?their respective income tax returns? Belinda is a cash basis taxpayer, and the other partners use the accrual method to report their incomes. Belinda is a cash basis taxpayer, and the other partners use the accrual method to report their incomes. TETRA IMAGES/GETTY IMAGESTETRA IMAGES/GETTY IMAGESWhat accounting method must be used to compute Belindas share of the partnership income?What accounting method must be used to compute Belindas share of the partnership income?"

THE BIG PICTURE JETRA IMACE SKETTY MAGES ACCOUNTING PERIOD AND METHOD Pearl, Inc. (a C corporation), Tweety, Inc. (an S corporation), and Belinda (an individual) are going to form a partnership (Silver Partnership). The ownership interests and tax years of the partners are as follows: Tax Year Ends Partner Partnership Interest Belinda 25% December 31 November 30 Pearl, Inc. 35% Tweety, Inc. 40% June 30 The partnership expects to begin business on April 1, 2018. The partners have several issues they would like you to address. A potential conflict exists among the partners regarding when the tax year should end for Silver. Belinda and Pearl would like a year-end close to their own year-ends, while Tweety would like to have a June 30 year-end. Is this a decision Tweety can make because it owns more of the partnership than either of the other two partners? Is this a decision Belinda and Pearl can make because collectively they own more of the partnership than Tweety owns? Because Silver will begin business on April 1, 2018, will the first tax year be a "short" tax year or a "long" tax year? Will annualization of the net income of the partnership be required? How will the partners know when their share of Silver's net income or net loss should be reported on their respective income tax returns? Belinda is a cash basis taxpayer, and the other partners use the accrual method to report their incomes. What accounting method must be used to compute Belinda's share of the partnership income? Read the chapter and formulate your response