Required information [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. In year 1, Julio and Milania each received distributions of $14,000 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 Amount Year 1 $ 315,000 (41,000) (40,000) (25,000) Allocated to Julio (17,000) (30,000) 10,000 1,300 0 $ 173,300 $ 28,000 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 $210,000 of qualified property (unadjusted basis). Year 2 $ 445,000 (62,000) (80,000) | (50,000) (34,000) | Allocated to Milania (50,000) 18,500 | 3,600 (2,000) | $ 189,100 $ 50,000
Required information [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. In year 1, Julio and Milania each received distributions of $14,000 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 Amount Year 1 $ 315,000 (41,000) (40,000) (25,000) Allocated to Julio (17,000) (30,000) 10,000 1,300 0 $ 173,300 $ 28,000 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 $210,000 of qualified property (unadjusted basis). Year 2 $ 445,000 (62,000) (80,000) | (50,000) (34,000) | Allocated to Milania (50,000) 18,500 | 3,600 (2,000) | $ 189,100 $ 50,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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11.
![Required information
[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. In year 1, Julio and Milania each received distributions
of $14,000 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
Amount
Year 1
$ 315,000
(41,000)
(40,000)
(25,000)
(17,000)
(30,000)
10,000
1,300
0
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 $210,000 of qualified property
(unadjusted basis).
Allocated to
Julio
$ 173,300
$ 28,000
Year 2
$ 445,000
(62,000)
(80,000) |
(50,000)
(34,000) |
(50,000)
18,500
3,600
(2,000)
$ 189,100
$ 50,000
Allocated to
Milania](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe14beb34-1ec9-4f51-b9d3-f13ff55cdae1%2F093687be-5632-452e-91fe-42ad5d7db16e%2Fwoi5wqo_processed.png&w=3840&q=75)
Transcribed Image Text:Required information
[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. In year 1, Julio and Milania each received distributions
of $14,000 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
Amount
Year 1
$ 315,000
(41,000)
(40,000)
(25,000)
(17,000)
(30,000)
10,000
1,300
0
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 $210,000 of qualified property
(unadjusted basis).
Allocated to
Julio
$ 173,300
$ 28,000
Year 2
$ 445,000
(62,000)
(80,000) |
(50,000)
(34,000) |
(50,000)
18,500
3,600
(2,000)
$ 189,100
$ 50,000
Allocated to
Milania
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