T6. [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 2, Julio and Milania each received distributions of $25,000 from Falcons Corporation.Sales revenueCost of goods soldSalary to owners Julio and MilaniaEmployee wagesDepreciation expenseSection 179 expenseInterest income (related to business income)Municipal bond incomeGovernment finesOverall net incomeDistributionsFalcons Corporation (an S Corporation)Income StatementDecember 31, Year 1 and Year 2Ordinary IncomeDistributionsSection 179 expenseInterest incomeMunicipal bond incomeGovernment finesAnswer is not complete.AmountJulio$ 200,000 $ 100,00050,00025,000(25,000)11,2502,000$ (1,000)(50,000)22,5004,000S (2,000)Year 1$ 300,000(40,000)(40,000)(25,000)(20,000)(30,000)12,0001,5000a. What amount of ordinary income and separately stated items are allocated to them for year 2 based on the information above?Assume that Falcons Corporation has $200,000 of qualified property (unadjusted basis).$$ 158,500$ 30,000Milania$ 100,00025,000(25,000)Year 2$ 430,000(60,000)(80,000)(50,000)11,250 X2,000(1,000)(40,000)(50,000)22,5004,000(2,000)$ 174,500$ 50,000

Introduction: An income statement representation that describes the income and expenses of an…

Jullo and Milania are owners of Falcons Corporation, an S corporation. Each owns 50 percent of Falcons Corporat year 2, Jullo and Milania each received distributions of $25,000 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 Distributions Section 179 expense Interest income Municipal bond income Government fines Answer is not complete. Amount Julio $ 200,000 $100,000 50,000 (50,000) What amount of ordinary income and separately stated items are allocated to them for year 2 based on the Informatio sume that Falcons Corporation has $200,000 of qualified property (unadjusted basis). 22,500 X 4,000 XS (2,000) 25,000 (25,000) Year 1 $ 300,000 (40,000) (40,000) (25,000) (20,000) (30,000) 12,000 1,500 0 $ 158,500 $ 30,000 11,250 X 2,000 $ (1,000) $ Milania $100,000 Year 2 $ 430,000 (60,000) (80,000) (50,000) (40,000) (50,000) 25,000 (25,000) 11,250 2,000 (1,000) 22,500 4,000 (2,000) $ 174,500 $ 50,000