Stuart owns a 20% interest in a partnership (not involved in real estate)in which his at-risk amount was $18,000 at the beginning of the year.The partnership produces a $50,000 loss for the year.What is Stuart's at-risk amount at the end of the year?
A)$0.
B)$8,000.
C)$10,000.
D)($32,000).

Question

Quizplus · Accepted Answer

Stuart's share of the partnership loss is 20% of $50,000, which equals $10,000. Since his at-risk amount was $18,000 at the beginning of the year, subtracting his share of the loss ($10,000) from his initial at-risk amount ($18,000) leaves him with an at-risk amount of $8,000 at the end of the year.

Stuart Owns a 20% Interest in a Partnership (Not Involved