Ed and Mike each have a 50% interest in Partnership Q. Both Ed's and the partnership's returns are filed on a calendar year basis. For its Year 1 tax year Partnership Q had a $12,000 loss. Ed's adjusted basis in his partnership interest on January 1, Year 1 was $4,000. In Year 2, Partnership Q had a profit of $8,000. Assuming there were no other adjustments to Ed's basis in the partnership in Year 1 and Year 2, what amount of partnership income (loss) should Ed show on his Year 1 and Year 2 individual income tax returns?

....... Year 1 ..... Year 2

Select one:

A.

($12,000); $8,000

B.

($8,000); $4,000

C.

None of these

D.

($4.000); $-0-

E.

($8,000); $8,000