Carol owns 40% of CJ Partnership. The partnership reports $170,000 of revenue, $60,000 cost of goods sold, and $70,000 of other expenses that include a $2,000 charitable contribution and a $5,000 Section 179 deduction. CJ Partnership also paid $1,500 of doctor bills for Carol. What is the ordinary business income reported on line 1 of Carols Schedule K-1?

1)

$40,000

2)

$20,300

3)

$18,800

4)

$16,000