The entity began business with 1000000 in assets 600000 in


The entity began business with $1,000,000 in assets, $600,000 in non-recourse debts, and $400,000 in capital. In its first year of operations it had a net loss of $500,000, and the liabilities did not change. In the second year of operations the entity generated $60,000 in taxable income and the liabilities did not change. Z was a 50% owner. Compute Z's share of income or loss for each year, assuming the passive activity rules do not apply and the entity was

a. LLC

b. S corporation

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Financial Accounting: The entity began business with 1000000 in assets 600000 in
Reference No:- TGS01067966

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