Sidney and Gertrude own 40% of Bearcave Bookstore, an S corporation. The remaining 60% is owned by their son Boris. Sidney and Gertrude do not participate in operating or managing the store, and they invested $19,000 in the business when it opened in 2008. The bookstore reported the following net income (loss) for the years 2008 through 2011:

a. How much do Sidney and Gertrude have at risk in Bearcave at the end of each year (2008–2011)?
b. What amount can they recognize as income or loss from Bearcave for each year (2008–2011)?
c. Assume that Sidney and Gertrude materially participate in Bearcave for each year (2008–2011). What amount can they recognize as income or loss from Bearcave for each year(2008–2011)?

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2008 2009 2010 2011 S(24,000) $(14,000) $(12,000) $5,000