Problem $14-17($Algorithmic$)($LO$.7)$

This year the Tastee Partnership reported income before guaranteed payments of $$126,500.$ Stella owns a $25\%$ profits interest and works $1,820$ hours per year in the business. Euclid owns a $75\%$ profits interest $($with a basis of $$30,000$ at the beginning of the tax year$)$ and performs no services for the partnership during the year. For services performed during the year, Stella receives a "salary" of $$6,325$ per month. Euclid withdrew $$12,650$ from the partnership during the year as a normal distribution of cash from Tastee $($i$.$e$.,$ not for services$).$

If required, round your answers to the nearest dollar.

a$.$ What is the amount of guaranteed payments made by the partnership this year?

b$.$ How much is the partnership's ordinary income after any permitted deduction for guaranteed payments?

c$.$ How much income will Stella report?

d$.$ How much income will Euclid report?