Ryan Ross (111-11-1112), Oscar Omega (222-22-2223), Clark Carey (333-33-3334),and Kim Kardigan (444-44-4445) are equal active members in ROCK the Ages LLC.ROCK serves as agent and manager for prominent musicians in the Los Angeles area.The LLCs Federal ID number is 55-5555556. It uses the cash basis and the calendaryear and began operations on January 1, 2009. Its current address is 6102 WilshireBoulevard, Suite 2100, Los Angeles, CA 90036. ROCK was the force behind suchmusic icons as Adrianna Venti, Drake Malone, Elena Gomez, Tyler Quick, QueenBey, and Bruno Mercury and has had a very profitable year. The following informa-tion was taken from the LLCs income statement for the current year.RevenuesFees and commissions $4,800,000Taxable interest income from bank deposits 1,600Tax-exempt interest 3,200Net gain on stock sales 4,000Total revenues $4,808,800ExpensesAdvertising and public relations $ 380,000Charitable contributions 28,000 179 expense 20,000Employee W2 wages 1,000,000Guaranteed payment (services), Ryan Ross, officemanager 800,000Guaranteed payment (services), other members 600,000Business meals subject to 50% disallowance 200,000Business restaurant meals and travel (100% deductible) 320,000Legal and accounting fees 132,000Office rentals paid 80,000Interest expense on operating line of credit 10,000Insurance premiums 52,000Office expense 200,000Payroll taxes 92,000Utilities 54,800Total expenses $3,968,800Recently, ROCK has taken advantage of bonus depreciation and 179 deductionsand fully remodeled the premises and upgraded its leasehold improvements. Thisyear, ROCK wrapped up its remodel with the purchase of $20,000 of office furniturefor which it will claim a 179 deduction. (For simplicity, assume that ROCK usesthe same cost recovery methods for both tax and financial purposes.) There is nodepreciation adjustment for alternative minimum tax purposes.ROCK invests much of its excess cash in non-dividend-paying growth stocksand tax-exempt securities. During the year, the LLC sold two securities. On June 15,ROCK purchased 1,000 shares of Tech, Inc. stock for $100,000; it sold those shareson December 15 for $80,000. On March 15 of last year, ROCK purchased 2,000shares of BioLabs, Inc. stock for $136,000; it sold those shares for $160,000 onDecember 15 of the current year. These transactions were reported to the IRS onForms 1099B; ROCKs basis in these shares was reported.Net income per books is $840,000. On January 1, the members tax basiscapital accounts equaled $200,000 each. No additional capital contributions weremade this year. In addition to their guaranteed payments, each member withdrew$250,000 cash during the year. All contributions and distributions have been incash, so the LLC has no net unrecognized 704(c) gain or loss. The LLCs balancesheet as of December 31 of this year is as follows. Beginning EndingCash $ 444,000 $ ??Tax-exempt securities 120,000 120,000Marketable securities 436,000 300,000Leasehold improvements, furniture, and equipment 960,000 980,000Accumulated depreciation (960,000) (980,000)Total assets $1,000,000 $ ??Operating line of credit $ 200,000 $ 160,000Capital, Ross 200,000 ??Capital, Omega 200,000 ??Capital, Carey 200,000 ??Capital, Kardigan 200,000 ??Total liabilities and capital $1,000,000 $ ??All debt is shared equally by the members. Each member has personally guaran-teed the debt of the LLC. All members are active in LLC operations.For our purposes, assume the LLC is not considered an SSTB, and ROCKs opera-tions constitute one active trade or business for purposes of the passive activity andat-risk limitations. (Note that the 179 deduction is a business-related expense.) TheLLCs UBIA (unadjusted basis immediately after acquisition) equals the total originalcost of all leasehold improvements, or $980,000.The appropriate business code for the entity is 711410. For the Form 1065, page 5,Analysis of Net Income, put all partners allocations in cell 2(b)(ii), per IRS instruc-tions for an LLC.a. Complete the 2021 Form 1065 for ROCK the Ages LLC with appropriate formsand schedules. Suggested software: ProConnect Tax. Use tax-basis informationfor Schedules L and M2. Provide any special information the LLC membersmight need, including net income from self-employment and information forthe 199A calculation. Attach additional statements if needed, and leave infor-mation blank if not available.b. Continue by preparing Schedules K1 for ROCKs members. Pay attention toany special allocation required for Ryan Ross. Rosss address is 15520 W. EarlsonStreet, Pacific Palisades, CA 90272. (Leave other addresses blank.)