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Acme Partnership reported the following items of income and expense: Sales $200,000 Cost of goods sold 115,000 Interest expense on bank line of credit 13,000 Charitable contributions 2,000 Administrative expenses 50,000 Long-term capital gain 10,000 What amount should be reported as ordinary income

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anthougo

The amount that ACME Partnership should report as ordinary income is $83,000.

Data and Calculations:

Sales Revenue =          $200,000

Cost of goods sold =       115,000

Gross profit =                 $85,000

Administrative expenses  2,000

Operating income =    $83,000

Interest expense             13,000

Taxable income           $70,000

Charitable contributions 2,000

Long-term capital gain  10,000

The operating income is the ordinary income before determining the eligibility of the charitable deductions and the long-term capital gain.

Thus, the ordinary income of ACME Partnership is $83,000.

Learn more: https://brainly.com/question/25056982

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