Question
Hello! I need help with the parts that are bolded! Please and thank you Ryan Ross (111-11-1112), Oscar Omega (222-22-2223), Clark Carey (333-33-3334), and Kim
Hello! I need help with the parts that are bolded! Please and thank you
Ryan Ross (111-11-1112), Oscar Omega (222-22-2223), Clark Carey (333-33-3334), and Kim Kardigan (444-44-4445) are equal active members in ROCK the Ages LLC. ROCK serves as agent and manager for prominent musicians in the Los Angeles area. The LLC's Federal ID number is 55-5555556. It uses the cash basis and the calendar year and began operations on January 1, 2009. Its current address is 6102 Wilshire Boulevard, Suite 2100, Los Angeles, CA 90036. ROCK was the force behind such music icons as Adrianna Venti, Drake Malone, Elena Gomez, Tyler Quick, Queen Bey, and Bruno Mercury and has had a very profitable year. The following information was taken from the LLC's income statement for the current year. Revenues Fees and commissions $4,800,000 Taxable interest income from bank deposits 1,600 Tax-exempt interest 3,200 Net gain on stock sales 4,000 Total revenues $4,808,800 Expenses Advertising and public relations $380,000 Charitable contributions 28,000 179 expense 20,000 Employee salaries and wages 1,000,000 Guaranteed payment (services), Ryan Ross, office manager 800,000 Guaranteed payment (services), other members 600,000 Business meals, subject to 50% disallowance 200,000 Business restaurant meals and travel (100% deductible) 320,000 Legal and accounting fees 132,000 Office rentals paid 80,000 Interest expense on operating line of credit 10,000 Insurance premiums 52,000 Office expense 200,000 Payroll taxes 92,000 Utilities 54,800 Total expenses $3,968,800 Recently, ROCK has taken advantage of bonus depreciation and 179 deductions and fully remodeled the premises and upgraded its leasehold improvements. This year, ROCK wrapped up its remodel with the purchase of $20,000 of office furniture for which it will claim a 179 deduction. (For simplicity, assume that ROCK uses the same cost recovery methods for both tax and financial purposes.) There is no depreciation adjustment for alternative minimum tax purposes. ROCK invests much of its excess cash in non-dividend-paying growth stocks and tax-exempt securities. During the year, the LLC sold two securities. On June 15, 2021, ROCK purchased 1,000 shares of Tech, Inc., stock for $100,000; it sold those shares on December 15, 2021, for $80,000. On March 15, 2020, ROCK purchased 2,000 shares of BioLabs, Inc., stock for $136,000; it sold those shares for $160,000 on December 15, 2021. These transactions were reported to the IRS on Forms 1099B; ROCK's basis in these shares was reported. Net income per books is $840,000. On January 1, 2021, the members' tax basis capital accounts equaled $200,000 each. No additional capital contributions were made in 2021. In addition to their guaranteed payments, each member withdrew $250,000 cash during the year. All contributions and distributions have been in cash, so the LLC has no net unrecognized 704(c) gain or loss. The LLC's balance sheet as of December 31, 2021, is as follows. Beginning Ending Cash $444,000 $?? Tax-exempt securities 120,000 120,000 Marketable securities 436,000 300,000 Leasehold improvements, furniture, and equipment 960,000 980,000 Accumulated depreciation (960,000) (980,000) Total assets $1,000,000 $?? Operating line of credit $200,000 $160,000 Capital, Ross 200,000 ?? Capital, Omega 200,000 ?? Capital, Carey 200,000 ?? Capital, Kardigan 200,000 ?? Total liabilities and capital $1,000,000 $?? The firm's activities do not constitute "qualified production activities" for purposes of the 199 deduction. (Note that the 179 deduction is a business-related expense.) The LLCs UBIA (unadjusted basis immediately after acquisition) equals the total original cost of all leasehold improvements, or $980,000. All debt is shared equally by the members. Each member has personally guaranteed the debt of the LLC. All members are active in LLC operations. The business code for the entity is 711410. Complete the 2021 Form 1065 for ROCK the Ages LLC with appropriate forms and schedules. Prepare Schedule K1 for Ryan Ross.
Statement 6 Form 1065, Schedule M-2, Line 4 Other Increases | ||
Tax-Exempt Interest and/or Tax-Exempt Other Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | $fill in the blank | |
Total | $fill in the blank | |
Statement 7 Form 1065, Schedule M-2, Line 7 Other Decreases | ||
Guaranteed Payments (other than health insurance) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | $fill in the blank | |
Non-Deductible Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | fill in the blank | |
Total | $fill in the blank |
Statement 3 Form 1065, Schedule K, Line 20c Other Reportable Items Business Interest Expense (Informational Only for Basis Limitations) Included as a Deduction on the Following Lines(s) Schedule K, line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$fill in the blank
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