The profit and loss statement of Strategy, Inc., an S corporation, shows net profits of $101,000 (book income). The corporation has four equal shareholders. From supplemental data, you obtain the following about some items that are included in the $101,000.
- selling expenses ($19,200)
- municipal bond interest income 2,000
- dividends receiving on Boeing stock 8,000
- section 1231 gain 6,000
- depreciation recapture income 13,000
- passive income 3,000
- short-term capital loss (9,000)
- salary paid to owners (each) (11,000)
- cost of goods sold (81,000)
a. determine the nonseparately computed income or loss.
b. what is the portion of ordinary income or loss for Zariat, one of the shareholders?