Type or past

In March of Year 1, Sally Rogers and Peter Dean began a business partnership. Each contributes cash of $75,000 and agrees to share income and losses equally. The following information is provided for the first fiscal year of the partnership.

a) The partnership net income of $328,000 consisted of the following sources of income: Business income $300,000 Eligible dividends 20,000 Taxable capital gains 10,000 Allowable capital losses (2,000) $328,000

b) In addition, the partnership received a tax-free capital dividend of $12,000 and donated $3,000 to registered charities.

c) Each partner takes draws totaling $60,000.

Determine the adjusted cost base for the partnership interest of each of the partners at January 1, Year 2.

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