Partnership hypo

Partnership hypo - Partnership Hypothetical 1 Anne Bob and Eric form and operate a business to distribute sporting goods and equipment at wholesale

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Partnership Hypothetical 1. Anne, Bob and Eric form and operate a business to distribute sporting goods and equipment at wholesale. The enterprise – whose letterhead, billheads and bank account are in the Name of ABE Sports Has built a Warehouse for $200,000 (on Land supplied By Bob), Which it depreciates to the tax advantage of the individual participants because it reports to the IRS as a partnership. Anne, Who has no assets, has furnished her talents as an administrator and manages the internal operations of the business. Bob contributed The use Of his land, Which he could Have sold For $40,000, And has Handled the firm’s sales, and Eric contributed $30,000 In cash And has Done the purchasing. The three have Agreed that Anne is, in all events, to receive the greater of $5,000 annually or one--‐third Of the profits. During the first years of the business, the three divide the annual profits equally among themselves. With the knowledge of the other two, Eric obtained half the cash from Mike, to whom (unbeknownst To them) he has promised half his profits.
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This note was uploaded on 10/18/2011 for the course LAW 700 taught by Professor Kim during the Spring '10 term at USC.

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Partnership hypo - Partnership Hypothetical 1 Anne Bob and Eric form and operate a business to distribute sporting goods and equipment at wholesale

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