A partnership in which a parent transferred a 40% interest by gift to a child generated a

Question:

A partnership in which a parent transferred a 40% interest by gift to a child generated a profit of $130,000. Capital is a material income-producing factor. The parent performed services valued at $44,000, while the child performed no services.

How much income is allocated to the parent for services and for use of capital?

Partnership
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...