Question $6$: Citrus Corporation is a calendar year S corporation with the following current year

information:

Operating loss

$$(1,140,000)$

Liabilities:

Notes payable, Big Apple Bank $,285,000$

Notes payable, Grapefruit $($individual$)190,000$

On January $1$ Grapefruit bought $60\%$ of Citrus Corporation for $$427,500.$ She then loaned

Citrus Corporation $$190,000($the amount above under liabilities$).$ How much of the

operating loss may Grapefruit deduct currently? Assume the excess business loss limitation

does not apply.

$$712,500$

$$760,000$

$$617,500$

$$541,500$