Ray, Carol, and Jack are equal partners in the RCJ Partnership, which uses the accrual method of accounting. All three materially participate in the business. RCJ reports financial accounting income of $156,000 for the current year. The partnership used the following information to determine financial accounting income.

The following additional information is available about the current year's activities.

Requirement 

a. What is RCJ's financial accounting income?

RCJ's financial accounting income is

.

Requirements b, c, and d. What is RCJ's partnership taxable income? What is RCJ's ordinary income (loss)? What are RCJ's separately stated items?

Begin by determining the partnership's taxable income, then ordinary income (loss), and finally separately stated items. (If a box is not used in the table leave the box empty; do not enter a zero. Use parentheses or a minus sign for loss and expenseamounts.)

	Taxable
	Income
Income
Operating profit
Rental income
Interest on municipal bonds
Interest on corporate bonds
Dividend income
Gain on investment land
Long-term capital gain
Short-term capital loss
Sec. 1231 gain
Unrecaptured Sec. 1250 gain
Expenses
Depreciation
Interest expense on mortgage
Interest expense on municipal bond loan
Guaranteed payment
Low-income housing expenditures
Total

Ordinary

Income

Separately

Stated Items

Data Table

Operating profit (excluding the items listed below)	$42,900
Rental income	23,000
Interest income:
Municipal bonds (tax-exempt)	13,000
Corporate bonds	3,100
Dividend income (all from less-than-20%-owned domestic corporations)	23,000
Gains and losses on property sales:
Gain on sale of land held as an investment (contributed by Ray six
years ago when its basis was $7,000 and its FMV was $19,000)	65,000
Long-term capital gains	30,000
Short-term capital losses	3,000
Sec. 1231 gain	7,000
Unrecaptured Sec. 1250 gain	37,000
Depreciation:
Rental real estate	14,000
Machinery and equipment	32,000
Interest expense related to:
Mortgages on rental property	23,000
Loans to acquire municipal bonds	6,000
Guaranteed payments to Ray	10,000
Low-income housing expenditures qualifying for credit	26,000

•	The partnership received a $1,400 prepayment of rent for next year but has not recorded it as income for financial accounting purposes.
•	The partnership recorded the land for financial accounting purposes at $19,000.
•	MACRS depreciation on the rental real estate and machinery and equipment were $14,000 and $33,000, respectively, in the current year.
•	MACRS depreciation for the rental real estate includes depreciation on the low-income housing expenditures.