XYZ Corp.(an S Corp) is owned by Jane and Rebecca who each 50% shareholders. At

Question

XYZ Corp.(an S Corp) is owned by Jane and Rebecca who each 50% shareholders. At the beginning of the year, Jane's basis in her XYZ stock was 40,000. XYZ reported the following information for 2010:
Sales revenue: 730,000, COGS (200,000), Long-term capital gain 8,000, Dividend income 5,000, tax-exempt interest 3,000, salary of owners (120,000), employees wages (50,000), depreciation expense (12,000), miscellaneous exp. (10,000), overall net inc. 354,000

What amount of ordinary business income is allocated to Jane? 
What is the amount and character of seperately stated items allocated to Jane?

Explanation / Answer

1&2 Allocation to jane @ 50% overall net inc 354000 Less: Long term capital gains 8000 Dividends 5000 Tax exempt interest 3000 Ordinary business income 338000 169000 Seperately stated items Long term capital gains 8000 4000 Dividends 5000 2500 Tax exempt interest 3000 1500

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