Question: Mira and Lemma are equal owners of an entity. Each contributed $25,000 cash to the entity. In addition, the entity obtains a loan of $100,000. The profits for the year are $30,000. Determine Mira and Lemma's basis at the end of the period assuming the entity is a partnership, a C corporation, or an S corporation.
a. If the entity is a partnership, Mira and Lemma each have a basis of $ at the end of the year.
b. If the entity is a C corporation, Mira and Lemma each have a basis of $ at the end of the year.
c. If the entity is an S corporation, Mira and Lemma each have a basis of $ at the end of the year.