Mark, a cash method taxpayer, is a partner in M&T Legal Services, a calendar-year partnership. Under the partnership agreement, Mark is to receive 50% of the partnership’s profits or losses. His two other partners each own a 25% interest in the profits of the partnership. Each partner is allowed to withdraw $8,000 each month for his or her living expenses. Mark withdrew $96,000 during the year as his monthly draw in 2018. In March 2019, Mark received an additional $54,000 as his share of distributed 2018 profits. The partnership earnings before partners’ withdrawals for 2018 totaled $600,000 million. 

Required

Compute Mark’s gross income from the partnership for 2018.

Answer rating: 100% (QA)

Partnership earnings before partners withdrawal for 2018 600000 Mill... View the full answer