Jhumpa, Stewart, and Kelly are all one-third partners in the capital and profits of Firewalker General Partnership. In addition to their normal share of the partnership's annual income, Jhumpa and Stewart each receive an annual guaranteed payment of $10,000 to compensate them for additional services they provide. Firewalker's income statement for the current year reflects the following revenues and expenses:           Sales revenue   $340,000   Interest income          3,300   Long-term capital gains          1,200   Cost of goods sold   (120,000)   Employee wages   (75,000)   Depreciation expense   (28,000)   Guaranteed payments   (20,000)   Miscellaneous expenses   (4,500)   Overall net income   $97,000     (Leave no answer blank. Enter zero if applicable.) c. How much self-employment tax will each partner pay assuming none has any other source of income or loss? (Round your intermediate calculations and final answers to the nearest whole dollar amount.)       Jhumpa Stewart Kelly Self-employment tax

Question

Jhumpa, Stewart, and Kelly are all one-third partners in the capital and profits of Firewalker General Partnership. In addition to their normal share of the partnership's annual income, Jhumpa and Stewart each receive an annual guaranteed payment of $10,000 to compensate them for additional services they provide. Firewalker's income statement for the current year reflects the following revenues and expenses:

 

       
Sales revenue   $340,000  
Interest income          3,300  
Long-term capital gains          1,200  
Cost of goods sold   (120,000)  
Employee wages   (75,000)  
Depreciation expense   (28,000)  
Guaranteed payments   (20,000)  
Miscellaneous expenses   (4,500)  
Overall net income   $97,000  
 

(Leave no answer blank. Enter zero if applicable.)

c. How much self-employment tax will each partner pay assuming none has any other source of income or loss? (Round your intermediate calculations and final answers to the nearest whole dollar amount.)

 
 
  Jhumpa Stewart Kelly
Self-employment tax      

Expert Answer

Want to see the step-by-step answer?

Check out a sample Q&A here.

Want to see this answer and more?

Experts are waiting 24/7 to provide step-by-step solutions in as fast as 30 minutes!*

*Response times vary by subject and question complexity. Median response time is 34 minutes and may be longer for new subjects.

Related Accounting Q&A

Find answers to questions asked by students like you.

Q: The current asset section of Stibbe Pharmaceutical Company’s balance sheet included cash of $20,000 ...

A: Click to see the answer

Q: “Management accounting deals only with costs.” Do you agree? Explain.

A: At the very outset i would like to say that i do not agree that management accounting deals with onl...

Q: “CVP analysis is both simple and simplistic. If you want realistic analysis to underpin your decisio...

A: CVP analysis refers to the cost-volume-profit analysis which describes the change in the operating i...

Q: Sydney Rangers Inc operates remote parking lots near major airports. The board of directors of this ...

A: Solution 1 Plan 1: If company borrows $5 million at 6% then we can calculate new earning per share a...

Q: Indicate which of the following costs should be expensed when incurred. a.    $13,000 paid to rearra...

A: Click to see the answer

Q: Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan con...

A: Click to see the answer

Q: Please Help

A: Variance is calculated by comparing the items of the two budgets prepared. Revenue and spending vari...

Q: Elroy Corporation repurchased 3,800 shares of its own stock for $55 per share. The stock has a par o...

A: Treasury Stock: It refers to the shares that are reacquired by the corporation that is already issue...

Q: How does the software Quickbooks relate to accounting?

A: Accounting: It is the recording of financial transaction of the business in a systematic manner and ...