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Please do mark sullivan schedule k-1 1065
The Aspen Ridge limited partnership was formed on April 1, 2010,
by Mark Sullivan, its general
partner, and two other limited partners when they each contributed
an equal amount of cash to
start the new enterprise. Aspen Ridge is an outdoor equipment
retailer selling camping, fishing,
skiing, and other outdoor gear to the general public. Mark has a
33.33 percent profits, loss, and
capital interest and the limited partners hold the remaining 66.66
percent of the profits, loss, and
capital interests. Their profits, loss, and capital interests have
remained unchanged since the
partnership was formed. Mark is actively involved in managing the
business while the limited
partners are only investors, and Mark receives an annual guaranteed
distribution of $35,000 for
his services managing the business.
 Aspen Ridge is located at 1065 North 365 South, Ogden, Utah
84401.
 The employer identification number for Aspen Ridge is
85-8976654.
 Aspen Ridge uses the accrual method of accounting and has a
calendar year-end.
 Mark’s address is 543 Wander Lane, Holliday, Utah 84503, and his
Social Security
number is 445-27-3584. Mark is designated as the Partnership
Representative in the
partnership agreement.
The following is Aspen Ridge’s 2020 income statement:
Aspen Ridge Income Statement
For year ending December 31, 2020
Sales $ 965,500
Sales returns and allowances (9,700)
Cost of goods sold (538,200)
Gross profit from operations $ 417,600
Other income:
Interest from money market account $ 3,200
Gain from sale of photograph 34,000
Gross income $ 454,800
Expenses:
Employee wages $ 95,400
Interest on accounts payable 2,700
Payroll and property taxes 10,800
Supplies 4,300
Rent on retail building 18,500
Depreciation on furniture and fixtures 4,550
Advertising 8,300
Guaranteed payments to Mark Sullivan 35,000
Utilities 6,400
Accounting and legal services 4,400
Business meals 2,240
Cash charitable contribution to the Sierra Club 3,300
Miscellaneous expenses 5,750
Total expenses (201,640)
Net income for books $ 253,160
Notes:
1. Aspen Ridge has total assets of $1,725,800 and total liabilities
of $540,300 at the
beginning of the year, and total assets of $2,065,300 and total
liabilities of $806,640 at
the end of the year.
2. Partnership liabilities consist of accounts payable, and Mark,
as general partner, is legally
responsible for paying these liabilities if the partnership does
not.
3. Two years ago, Aspen Ridge purchased an original Ansel Adams
outdoor landscape
photograph with the intent to display it permanently in the retail
store. This year,
however, the photograph was sold to a local ski lodge where it now
hangs on the wall.
The $34,000 recognized gain from the sale is reflected in the
income statement above.
4. For tax purposes, Aspen Ridge has consistently elected out of
bonus depreciation and has
elected instead under §179 to expense any furniture or fixtures
placed in service every
year since it was formed. As a result, it does not have a tax basis
in any of its depreciable The following is Aspen Ridge’s 2020
income statement:
Aspen Ridge Income Statement
For year ending December 31, 2020
Sales $ 965,500
Sales returns and allowances (9,700)
Cost of goods sold (538,200)
Gross profit from operations $ 417,600
Other income:
Interest from money market account $ 3,200
Gain from sale of photograph 34,000
Gross income $ 454,800
Expenses:
Employee wages $ 95,400
Interest on accounts payable 2,700
Payroll and property taxes 10,800
Supplies 4,300
Rent on retail building 18,500
Depreciation on furniture and fixtures 4,550
Advertising 8,300
Guaranteed payments to Mark Sullivan 35,000
Utilities 6,400
Accounting and legal services 4,400
Business meals 2,240
Cash charitable contribution to the Sierra Club 3,300
Miscellaneous expenses 5,750
Total expenses (201,640)
Net income for books $ 253,160
Notes:
1. Aspen Ridge has total assets of $1,725,800 and total liabilities
of $540,300 at the
beginning of the year, and total assets of $2,065,300 and total
liabilities of $806,640 at
the end of the year.
2. Partnership liabilities consist of accounts payable, and Mark,
as general partner, is legally
responsible for paying these liabilities if the partnership does
not.
3. Two years ago, Aspen Ridge purchased an original Ansel Adams
outdoor landscape
photograph with the intent to display it permanently in the retail
store. This year,
however, the photograph was sold to a local ski lodge where it now
hangs on the wall.
The $34,000 recognized gain from the sale is reflected in the
income statement above.
4. For tax purposes, Aspen Ridge has consistently elected out of
bonus depreciation and has
elected instead under §179 to expense any furniture or fixtures
placed in service every
year since it was formed. As a result, it does not have a tax basis
in any of its depreciable
assets. This year, Aspen Ridge expensed $17,300 of signs and
display cases for tax
purposes.
5. On November 20, Aspen Ridge distributed $180,000 ($60,000 per
partner) to the
partners.
6. Miscellaneous expenses reported on the income statement include
a $900 fine for
violating a local signage ordinance.
7. All three partners’ capital accounts each had an opening balance
of $395,166.33.
8. Assume that Aspen Ridge did not make any payments that would
require it to file
Form(s) 1099.
9. For purposes of the Qualified Business Income Deduction (§199A),
the unadjusted basis
of qualified property immediately after acquisition (UBIA) is
$1,240,800.