do you report actual income form a partnership or do you report disbursment to partners as income?

Question

which of the above incomes are posted to form 1040

Answer 1

The partners share of income/loss and distributions are both reported on a partner's K-1. The partner then reports his share of income or loss on his individual tax return. The distributions received are not considered income. However, if the distributions received are in excess of the partner's basis, then he would have to pick up this excess distribution as capital gain on Schedule D.

Answer 2

I believe you report your share of ACTUAL partnership income. The link below is IRS Publication 541 Partnerships. It may be useful.