In year 2, Julio and Milania received distributions of $20,000 and $30,000, respectively, from Falcons Corporation. Falcons Corporation (an S Corporation).

Complete Milanias 1120S, Schedule K-1 for year 2. Use the 2015 tax rules.

Falcons Corporation (an S Corporation) Income Statement December 31, Year 1 Year 1 Year 2 $300,000 430,000 Sales revenue Cost of goods sold Salary to owners Jullo and Milanla Employee wages Depreciatlon expense Section 179 expense Interest Income Municlpal bond Income Government fines (40,000) (60.000) (40,000) (80.000) (25,000) (50.000) (40,000) (30.000) (50.000) 22,500 4.000 (2,000) (20,000) 12.000 1,500 Overall net income $158,500 $174,500 Distributions 30,000 50,000