At-Risk Loss Limitation. The KC Partnership is a general partnership that manufactures widgets. The partnership uses a calendar year as its tax year and has two equal partners, Kerry and City Corporation, a widely held corporation. On January 1 of the current year, Kerry and City Corporation each has a $200, 000 basis in the partnership interest. Operations during the year produce the following results: Ordinary loss $900, 000 Long-term capital loss 100, 000 Short-term capital gain 300, 000 The only change in KC's liabilities during the year is KC's borrowing $100, 000 as a non recourse loan (not qualified real estate financing) that remains outstanding at year-end. What is each partner's deductible loss from the partnership's activities before any passive loss limitation? What is each partner's basis in the partnership interest after the year's operations? How would your answers to Parts a and b change if the KC Partnership's business were totally in real estate but not a rental activity? Assume the loan is qualified real estate financing