1 Part 1 of 3 1.66 points Required Information [The following Information applies to the questions displayed below.] Julio and Milania are owners of Falcons Corporation, an S corporation. Each owns 50 percent of Falcons Corporation. In year 1, Julio and Milania each received distributions of $12,000 from Falcons Corporation. Falcons Corporation (an S Corporation) Income Statement December 31, Year 1 and Year 2 Sales revenue Skipped Cost of goods sold Salary to owners Julio and Milania Employee wages eBook Print Depreciation expense Section 179 expense Interest income (related to business income) Municipal bond income Government fines Overall net income Distributions Year 1 $ 320,000 (41,000) Year 2 $ 450,000 (64,000) (40,000) (80,000) (30,000) (60,000) (17,000) (34,000) (30,000) (50,000) 12,000 1,800 22,500 $ 175,800 4,600 (3,000) $186,100 $ 24,000 $ 50,000 References a. What amount of ordinary Income and separately stated Items are allocated to them for year 1 based on the Information above? Assume that Falcons Corporation has $220,000 of qualified property (unadjusted basis). Ordinary Income Section 179 expense Qualified business income Municipal bond income Distributions Allocated wages Unadjusted basis of qualified property Amount Allocated to Allocated to Julio Milania