a. What amount of ordinary income and separately stated items are allocated to them for year 1 based on the information above Assume that Falcons Corporation has $200,000 of qualified property (unadjusted basis). Ordinary Income Section 179 expense Interest income Municipal bond income Government fines Distributions > Answer is not complete. Amount $ 175,000 30,000 X 12,000 X 1,500 Allocated to Julio $ 87,500 15,000 Allocated to Milania $ 6,000 X 750 200 X $ $2,000 $ $ 30,000 $ 15,000 $ 87,500 15,000 6,000 X 750 200 X 15,000
a. What amount of ordinary income and separately stated items are allocated to them for year 1 based on the information above Assume that Falcons Corporation has $200,000 of qualified property (unadjusted basis). Ordinary Income Section 179 expense Interest income Municipal bond income Government fines Distributions > Answer is not complete. Amount $ 175,000 30,000 X 12,000 X 1,500 Allocated to Julio $ 87,500 15,000 Allocated to Milania $ 6,000 X 750 200 X $ $2,000 $ $ 30,000 $ 15,000 $ 87,500 15,000 6,000 X 750 200 X 15,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
kak.2
Transcribed Image Text:Julio and Milania are owners of Falcons Corporation, an S corporation. Each owns 50 percent of Falcons Corporation. In
year 1, Julio and Milania each received distributions of $15,000 from Falcons Corporation.
Sales revenue
Cost of goods sold
Salary to owners Julio and Milania
Employee wages
Falcons Corporation (an S Corporation)
Income Statement
December 31, Year 1 and Year 2
Depreciation expense
Section 179 expense
Interest income (related to business income)
Municipal bond income
Government fines
Overall net income
Distributions
Ordinary Income
Section 179 expense
Interest income
Municipal bond income
Government fines
Distributions
> Answer is not complete.
X
Amount
$ 175,000
30,000
12,000 X
1,500
2,000
30,000
a. What amount of ordinary income and separately stated items are allocated to them for year 1 based on the information above?
Assume that Falcons Corporation has $200,000 of qualified property (unadjusted basis).
X $
$
Allocated to
Julio
$
$
$
Year 1
$ 300,000
(40,000)
(40,000)
(25,000)
87,500
15,000
$ 158,500
$ 30,000
(20,000)
(30,000)
12,000
1,500
0
Allocated to
Milania
$
6,000 X
750
200 × $
15,000 $
87,500
15,000
Year 2
$ 430,000
(60,000)
(80,000)
(50,000)
(40,000)
(50,000)
6,000 X
750
200
15,000
22,500
4,000
(2,000)
$ 174,500
$ 50,000
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