The profit and loss statement of Kitsch Ltd., an S corporation, shows $175,000 book income. Kitsch is owned equally by four shareholders. From supplemental data, you obtain the following information about items that are included in book income. Selling expenses Tax-exempt interest income Dividends received. § 1231 gain Depreciation recapture income Net income from passive real estate rentals Long-term capital loss. Salary paid to owners (each) Cost of goods sold The entity's nonseparately stated computed ($35,000) 5,250 15,750 12,250 17,500 8,750 a. Compute Kitsch's nonseparately stated income or loss for the tax year. (10,500) (21,000) (157,500) Is the income taxable to him this year? is $ b. What would be the share of this year's nonseparately stated income or loss items for James Billings, one of the Kitsch shareholders? c. What is James Billings' share of tax-exempt interest income, if any? Round your answer to the nearest dollar.
The profit and loss statement of Kitsch Ltd., an S corporation, shows $175,000 book income. Kitsch is owned equally by four shareholders. From supplemental data, you obtain the following information about items that are included in book income. Selling expenses Tax-exempt interest income Dividends received. § 1231 gain Depreciation recapture income Net income from passive real estate rentals Long-term capital loss. Salary paid to owners (each) Cost of goods sold The entity's nonseparately stated computed ($35,000) 5,250 15,750 12,250 17,500 8,750 a. Compute Kitsch's nonseparately stated income or loss for the tax year. (10,500) (21,000) (157,500) Is the income taxable to him this year? is $ b. What would be the share of this year's nonseparately stated income or loss items for James Billings, one of the Kitsch shareholders? c. What is James Billings' share of tax-exempt interest income, if any? Round your answer to the nearest dollar.
Chapter17: Corporations: Introduction And Operating Rules
Section: Chapter Questions
Problem 47P
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