Question
Belgrad, Inc. is a calendar year S corporation. Rahid owns 40% of Belgrads stock. The following information is obtained from the corporate records: Gross Income
Belgrad, Inc. is a calendar year S corporation. Rahid owns 40% of Belgrads stock. The following information is obtained from the corporate records:
Gross Income from Operations $80,000
Tax-exempt interest income 3,000
Dividends received from non-US corporations 5,000
Charitable contributions (6,000)
Depreciation recapture income 11,000
Interest income from bank 5,000
Salary paid to Rahid (52,000)
Short-term capital loss on investments (6,000)
Cost of goods sold (72,000)
Long-term capital gain on investments 14,000
Selling and administrative expenses (29,000)
Attach an excel spreadsheet to answer the three (3) questions below:
1. Using the information above, calculate Belgrads book income or loss.
2. Rahids beginning stock basis is $32,000 and he purchased $9,000 worth of additional stock during the year. Compute Rahids ending stock basis for the year.
3. Belgrads beginning AAA was $31,000, what is AAA at year-end?
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