!Required informationProblem 11-52 (LO 11-3) (Algo)[The following information applies to the questions displayed below.]Julio and Milania are owners of Falcons Corporation, an S corporation. Each owns 50 percent of Falcons Corporation. Inyear 1, Julio and Milania each received distributions of $14,000 from Falcons Corporation.Falcons Corporation (an S Corporation)Income StatementDecember 31, Year 1 and Year 2Year 1Year 2$ 330, 000(42, 000)(40, 000)(30, 000)(20, 000)(30, 000)10, 000$ 460, 000(65, 000)(80, 000)(60, 000)(40, 000)(50, 000)Sales revenueCost of goods soldSalary to owners Julio and MilaniaEmployee wagesDepreciation expenseSection 179 expenseInterest income (related to business income)18, 5003, 600(3, 000)$ 184, 100Municipal bond income1, 300Government finesOverall net income$ 179, 300$ 28, 000$ 50, 000DistributionsProblem 11-52 Part a (Algo)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 $230,000 of qualified property (unadjusted basis).Allocated to Allocated toJulioAmountMilaniaOrdinary Income

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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 $14,000 from Falcons Corporation.

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 $14,000 from Falcons Corporation.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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