provide an explanation of the correct answer and why the other choices are incorrect.

2) Peter, a 25% partner in Gold & Stein Partnership, received a $20,000 guaranteed payment in the current year for deductible services rendered to the partnership. Guaranteed payments were not made to any other partner. Gold & Steins current-year partnership income consisted of:

Net business income before guaranteed payments $80,000

Net long-term capital gains 10,000

What amount of income should Peter report from Gold & Stein Partnership on his current-year tax return?

a) $37,500

b) $27,500

c) $22,500

d) $20,000