Jack is one of two general partners in WPW Partnership. They share equally in income and losses. At the beginning of the current tax year, Jack's adjusted basis in WPW is zero, and he has a $1,000 loss from the previous tax year, which he could not recognize due to the adjusted basis limitation. During the current tax year, WPW had $9,000 ordinary business income. Jack did not contribute funds during the tax year and did not increase his share of partnership liabilities, but he did withdraw $2,000.

This is a two-part question.

Question 1: What is Jack's adjusted basis in WPW Partnership at the end of the current tax year?

Question 2: How much partnership income will Jack report on his personal tax return for the current tax year?

a) $4,500; $4,500

b) $3,500; $4,500

c) $3,500; $3,500

d) $1,500; $3,500