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Derohanian and Duan are equal partners in the DD Partnership. For the current year ended December 31, the partnership has taxable income of $75,000, which

  1. Derohanian and Duan are equal partners in the DD Partnership. For the current year ended December 31, the partnership has taxable income of $75,000, which includes the following deductions: (1) guaranteed payments (salaries) to partners: Derohian, $35,000; and Duan, $25,000; and (2) charitable contributions, $6,000. What amount should be reported as OBI on the partnership return?

    a.141,000
    b.135,000
    c. 81,000
    d. 75,000
  2. During the year, Baral Corporation had the following transactions:

    Net income per books (after tax) 50,000
    Included in that amount were the following items

    FIT

    7,000

    Interest income from Federal treasury bonds

    4,000

    Interest expense paid on loan (proceeds were used to purchase treasury bonds)

    3,500

    Interest income from municipal bonds

    2,000

    Premiums paid on life ins policy where the employee is the beneficiary

    8,000

    Net capital gain (9,000 LTCG less 5,500 STCL)

    3,500

    Compute taxable income.


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