The following income statement was prepared for Ludlum, Clancy, Follet & Associates, a partnership comprised of four partners who share
The adjusted cost base to Mr. Clancy of his partnership interest was $45,792 at the beginning of the year. His drawings for the year were $77,500.
The dividends were received from a CCPC, all of whose income was eligible for the small business deduction.
(A) Compute the partnership income for the year, the income to be allocated to Mr. Clancy and the nature of the income.
(B) Compute Mr. Clancy's taxable income and tax payable for 2008 assuming a marginal federal tax rate of 29% and a provincial marginal tax rate of 17%.
(C) Compute the adjusted cost base to Mr. Clancy of his partnership interest.
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...
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