What is xyz ordinary income or loss


Problem: The XYZ partnership provides that D will receive a guaranteed salary of $30,000 each year for her services as an accountant.  She will also receive one-third of the taxable income or loss.  For the current year the partnership has ordinary income of $18,000 before the salary payment, a Section 1231 gain of $9,000, and short-term capital gain of $3,000.  All taxpayers are cash method and have a calendar year end. The $30,000 salary is paid to D evenly throughout the year. What is XYZ's ordinary income or loss?

a. $0

b. $ 8,000

c. $12,000

d. $18,000

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