Jack and Jill are owners of UpAHill, an S Corporation. They own 25 and 75 percent, respectively. UpAHill Corporation (an S Corporation) Income Statement December 31, Year 1 and Year 2 Sales revenue Cost of goods sold Salary to owners Jack and Jill Employee wages Depreciation expense Miscellaneous expenses Interest income (related to business) Qualified dividend income Overall net income Ordinary income Dividend income Interest income Allocated wages Unadjusted basis of qualified property a. What amount of ordinary income and separately stated items are allocated to them for years 1 and 2 based on the information above? Assume that UpAHill Corporation has $100,000 of qualifie property (unadjusted basis) in both years. Year 2 $ 310,000 (85,000) (40,000) (50,000) (15,000) (20,000) (10,000) (15,000) (7,500) (9,000) 2,000 500 Year 1 $ 45,000 500 $44,500 $ Year 1 $ 175,000 (60,000) 2,500 1,000 $ 45,000 $ 134,500 Answer is complete but not entirely correct. Jack 25 * $ 11,125 $ Year 2 Year 1 $134,500 $ 45,000 $1,000 $ 500 44,500 $ 133,500 $ 25 * $ 33,375 $ Jill Year 2 $134,500 > $1,000 X $133,500 > 75 X 75 × $ 33,375 $ 100,125
Jack and Jill are owners of UpAHill, an S Corporation. They own 25 and 75 percent, respectively. UpAHill Corporation (an S Corporation) Income Statement December 31, Year 1 and Year 2 Sales revenue Cost of goods sold Salary to owners Jack and Jill Employee wages Depreciation expense Miscellaneous expenses Interest income (related to business) Qualified dividend income Overall net income Ordinary income Dividend income Interest income Allocated wages Unadjusted basis of qualified property a. What amount of ordinary income and separately stated items are allocated to them for years 1 and 2 based on the information above? Assume that UpAHill Corporation has $100,000 of qualifie property (unadjusted basis) in both years. Year 2 $ 310,000 (85,000) (40,000) (50,000) (15,000) (20,000) (10,000) (15,000) (7,500) (9,000) 2,000 500 Year 1 $ 45,000 500 $44,500 $ Year 1 $ 175,000 (60,000) 2,500 1,000 $ 45,000 $ 134,500 Answer is complete but not entirely correct. Jack 25 * $ 11,125 $ Year 2 Year 1 $134,500 $ 45,000 $1,000 $ 500 44,500 $ 133,500 $ 25 * $ 33,375 $ Jill Year 2 $134,500 > $1,000 X $133,500 > 75 X 75 × $ 33,375 $ 100,125
Chapter13: Choice Of Business Entity—general Tax And Nontax Factors/formation
Section: Chapter Questions
Problem 46P
Related questions
Question
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you