2. Smith Corp. has made S - election on the date of its incorporation in year 2012. For the year 2019, Smith has a gross receipt for the year totaling $350,000 of which $100,000 is passive investment income. Expenditures directly connected to the production of the passive income total $35,000. Calculate Smith Corp.s passive investment income tax (assume the tax rate 21%). Please show all calculations.

3. Tami, a U.S. Citizen, is a sole shareholder of S corporation, named "Happiness". she has $5,000 basis in stock. Tami also loaned money to S Corporation and has basis of $3,000. Assume no AEP, calendar year and beginning balance of AAA and OAA accounts are zero. The Corp. made $10,000 in the ordinary income which was reported on Tami's K-1. Corp. also received a tax- free interest income of $4,000 which was also reported on K-1. Tami took a distribution of $21,000 during the year from the S corporation. Please calculate the year-end balances in AAA account, OAA Account, Tami's stock basis and loan basis showing the effects of the distribution. Please show all calculations.

4. Spencer purchased his partnership interest from John the first day of the current year for $40,000 cash. Michelle and Sue are other two partners in this business. Spencer received a $10,000 cash distribution from the partnership during the year, and his share of partnership income is $15,000. His share of partnership liabilities on the last day of the partnership year is $20,000. Spencer's outside basis for his partnership interest at the end of the year is $______. Please show all calculations.