.Inthecurrentyear, theDOELLC received revenuesof$300,000 and paid the followingamounts:$50,000 of business expenses (rent, utilities, wages, depreciation, etc.),a$50,000 guaranteed payment (for services)to50%member Dave, $20,000tomember Ethanforconsulting services,and$10,000as adistributiontomember Olivia. Inaddition,the LLCearned $4,000oftax-exempt interest income duringtheyear. Daveis themanaging memberofthe LLC. Dave's basisin his LLCinterestwas$50,000at thebeginningof theyearandincludesa$15,000 share ofLLCliabilities.Atthe endoftheyear,hisshareoftheLLC's liabilitieswas$25,000.

a. How much income must Dave report for the tax year and what is the character of theincome?

b. What is Dave's basis in his LLC interest at the end of the taxyear?

c. Onwhat income will Dave's self-employmenttax becalculated?

d.Whatisthemaximum amountDavemightbeabletodeductforthis business under [section symbol] 199A?