Stephanie and David are a married couple who run a small business in a 50:50 partnership structure selling agricultural produce. There is no written partnership agreement.

During the year ended 30 June 2021 they generated $480,000 in sales of agricultural produce and incurred $50,000 in deductible expenses.

The partners appropriated the following partnership salaries to each other:

Stephanie $112,000

David $ 24,000

- Stephanie and David also own an investment property as joint tenants which generated $180,000 in gross rent and had $28,000 in deductible expenses.

- They have two children, twins, Oliver and Olivia both 23 and fulltime university students.

- The twins live with their parents, and they do not have any other income.

- The family does have private health insurance.

Required:

1. Construct the partnership net income of the business entity for the year ended 30 June 2021
2. Prepare and calculate a partnership distribution statement for the business entity for the year ended 30 June 2021
3. Evaluate the income tax consequences of a partnership structure with respect to the individual partners of the business entity for the year ended 30 June 2021

Answer rating: 100% (QA)

Answer A Construct the partnership net income of the business entity for th... View the full answer