Two real estate companies, Real Company and Lay Company (the parties) set up a separate vehicle (entity X) for the purpose of acquiring a shopping centre. The contractual arrangement between the parties establishes joint control of the activities that are conducted by entity X. The main feature of entity X's legal form is that the entity, not the parties has rights to the assets and obligations for the liabilities relating to the arrangement. Summary transactions of the joint arrangement for 2017 and 2018 are as follows: 2017: 4 B The parties contributed $10 million each for 40% interest. Taxes and licenses paid amounted to $200,000. Acquired office furniture and equipment on account, $2 million. Entity X acquired land at a cost of $3 million. Constructed a building (shopping center) at a cost of $12 million Operating expenses for the year amounted to $1 million Rental income collected from the tenants, $5 million. Net income or loss was distributed to the parties in accordance with their interest. 2018: Operating expenses (including depreciation) incurred for the year, $500,000 Rental income collected for the year, $8 million Declared and paid dividends, $3 million Each venture received a share of the income or loss from rental income net of expenses Questions: 1. What is the net income(loss) of entity X for the year ended December 31, 2018? 2. What is the interest of Real Company in entity X for the year ended December 31, 2017? 3. What is the interest of Lay Company in entity X for the year ended December 31, 2018