Mohamed Khan and Aaron Grieve Are Equal Partners in a Small

Mohamed Khan and Aaron Grieve are equal partners in a small business which received the following income in 2020: business income of $150,000, non-eligible dividends of $4,000, and a capital gain of $10,000.Mohamed withdrew $20,000 from the partnership during 2020 and Aaron withdrew $25,000.Which of the following is correct for the 2020 taxation year?

A) Mohamed's net income for tax purposes from the business is $59,800 and Aaron's net income for tax purposes is $54,800.
B) Both partners have a net income for tax purposes from the business of $79,500.
C) Both partners have a net income for tax purposes from the business of $79,800.
D) Both partners have a net income for tax purposes from the business of $82,000.

Correct Answer:

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