Jim, Liz, and Keith are equal partners in the JLK Partnership, which uses the accrual method of accounting. All three materi-ally participate in the business. JLK reports financial accounting income of $186,000 for the current year. The partnership used the following information to determine financial accounting income.

Operating profit ( excluding the items listed below) $94,000 Rental income 30,000 Interest income: Municipal bonds (tax-exempt) 15,000 Corporate bonds 3,000 Dividend income (all from less-than-20%-owned domestic 20,000 corporations) Gains and losses on property sales: Gain on sale of land held as an investment (contributed by Jim six 60,000 years ago when its basis was $9,000 and its FMV was $15,000) Long-term capital gains 10,000 Short-term capital losses 7,000 Sec. 1231 gain 9,000 Unrecaptured Sec. 1250 gain 44,000 Depreciation: Rental real estate 12,000 Machinery and equipment 27,000 Interest expense related to: Mortgages on rental property 18,000 Loans to acquire municipal bonds 5,000 Guaranteed payments to Jim Low-income housing expenditures qualifying for credit 30,000 21,000