Rich is a partner in RKW partnership. Rich owned 50% from January 1, 2018 through April 30, 2018, when he bought Kevin's 25% interest. He owned 75% for the rest of the year (assume a 365-day year). The partnership had ordinary income of $150,000 and $25,000 in long-term capital gains. Barring any special allocations in a partnership agreement, Rich's share of the income items is (round the answers up to the nearest whole dollar):
A. $75,000 ordinary income; $12,500 capital gain.
B. $100,172 ordinary income; $16,696 capital gain.
C. $150,000 ordinary income; $25,000 capital gain.
D. $112,500 ordinary income; $18,750 capital gain.
Answer: B
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