ABC LLC reported the following items on the LLC's Schedule K: ordinary income, $100,000? interest income, $3,000? long-term capital loss, ($4,000)? charitable contributions, $1,000? depreciation adjustment, $10,000? and cash distributions to partners, $50,000. How much will ABC show as net income (loss) on its Analysis of Income (Loss)?
A) $68,000
B) $78,000
C) $95,000
D) $98,000
E) $102,000

Question

Quizplus · Accepted Answer

Net income is calculated by adding ordinary income and interest income, then subtracting the long-term capital loss and charitable contributions. Depreciation adjustment and cash distributions do not affect net income. Thus, $100,000 + $3,000 - $4,000 - $1,000 = $98,000.

ABC LLC Reported the Following Items on the LLC's Schedule