* Please complete the Book Vs Tax sheet & Identify which items are Ordinary & Separated (include the amounts) *

The partnership was formed by Arie (Individual), Bell(Individual) and Carpenter, Inc. (Corporation).

Blue Bell General Partnership

1/1/2019

Assets Liabilities

Current Current

Cash $135,000 Accounts Payable $5,000

Accounts Receivable $200,000

Allowance for Doubtful Accounts ($50,000)

Long-term Long-term

Land $15,000 Loan $10,000

Equity

Capital-Arie $95,000

Capital-Bell $95,000

Capital-Carpenter,Inc $95,000

Total Assets $300,000 Total Claims $300,000

Blue Bell General Partnership

12/31/2019

Assets Liabilities

Current Current

Cash $69,300 Accounts Payable $3,000

Accounts Receivable $150,000

Allowance for Doubtful Accounts ($35,000)

Investments $20,000

Long-term Long-term

Land $15,000 Loan $30,000

Equipment $10,000 Equity

AccDep-Equipment ($2,000) Capital-Arie $366,233

Capital-Bell $366,233

Capital-Carpenter,Inc $366,233

Each partner received a distribution of $20,000 in cash

Total Assets $227,300 Total Claims $1,131,700

Accounts Net Income per Books Adjustments Taxable Income

Sales Revenue $1,000,000.00

Cost of Goods Sold ($600,000.00)

Gross Margin $400,000.00

Dividends from 10% owned Corporation $2,000.00

Interest from city issued bonds $500.00

Interest from Investments $2,000.00

Capital Gains from sale of real estate $10,000.00

Royalty Income $7,000.00

Salaries ($350,000.00)

Parking fines ($200.00)

Organizational Expense (Total $40,000) Amortize over 10 years company started this year (1/1/2019) ($4,000.00)

Bad Debt Expense (for AR allowance adjustment; 10% of accrual amount actually written off) ($15,000.00)

Owner Expensed his business related trip to Las Vegas ($3,500.00)

Guaranteed Payments ($7,000.00)

Capital Loss from sale of equipment ($14,000.00)

Warrant Expense (Actual payments = $2,000) ($1,500.00)

Depreciation Expense ($10,000 piece of equipment acquired on 6/1/2019. Totally written off for tax purposes) ($2,000.00)

Charitable Contributions ($50,000.00)

Meals and Entertainment ($5,000.00)

Net Income ($30,700.00) $0.00 $0.00