Earl and Sandra own and operate a restaurant as an S corporation. Each is a 50% owner. The business reports the following results for the year:

Revenue	$	480,000
Business expenses		398,000
Investment expenses		32,000

How do Earl and Sandra report these items for tax purposes on each of their individual returns?

Group of answer choices

$82,000 income on Schedule E; $32,000 investment expense on Schedule A.

$480,000 income on Schedule E; $16,000 investment expense on Schedule A.

$41,000 income on Schedule E; $32000 investment expense on Schedule A.

$41,000 income on Schedule E; $16,000 investment expense on Schedule A.