Schedule E

According to sec100-50, the net capital gain or net capital loss for the income year is

each element in your Question 1 pro forma profit and loss statement. Are there any items that

b. Fill out the Payments, Credits, and Tax section of the 1040EZ form using the following information:

b. Fill out the Payments, Credits, and Tax section of the 1040EZ form using the following information:

25-7 If a loss cannot be accrued in the period when ti is probable that an asset had been impaired or a liability had been incurred because the amount of loss cannot be reasonable estimated, the loss shall be charged to the income of the period in which the loss can be reasonably estimated and shall not be charged retroactively to an earlier period. All estimated losses for loss contingencies shall be charged to income rather than charging some to income and others to retained earnings as prior period adjustments.”

An estimated loss from a loss contingency shall be accrued by a charge to income if both of the following conditions are met:

Passive activity is an activity in which an investor can earn profit from an activity in which he/she does not physically participate, including rentals and limited partnerships. In this scenario the couple has one rental property from which they received revenue that can be classified as passive income. The passive income has generated a net loss of $6,200. Since the couple has hired a realty company to manage their rental property then the loss must be carried over to the following year. These losses are reported on Form 8582. The $44,000 profit earned from the sale of the third rental property also needs to be reported but will be taxed as Long Term Capital Gains and will be entered as “Other gains or (losses)” using Form 4797.

An accrual is not made for a loss contingency because any of the conditions in paragraph 450-20-25-2 are not met., b.  An exposure to loss exists in excess of the amount accrued pursuant to the provisions of paragraph 450-20-30-1.” Therefore, they also need to disclose the range of the possible loss with some explanation.

Once a gain or loss is recognized, a taxpayer must determine how the recognized gain or loss affects the taxpayer’s tax liability. The character depends on a combination of two factors: purpose or use of the asset and holding period. The purpose or use of the asset is important because the law does not treat all assets equally. The general use categories are: (1) trade or business, (2) for the production of income (rental activities), (3) investment, and (4) personal. Based on these criteria, we can categorize an asset into one of three groups: (1) ordinary, (2) capital, or (3) section 1231. Characterizing the gain or loss is important because all gains and losses are not equal. Ordinary gains and losses are taxed at ordinary income rates, regardless of the holding

As per ASC 450-20-25-2, entities should accrue an estimated loss from a loss contingency by a charge to expense and a liability recorded only if both of the following conditions are met:

6. MB4 Profit and Loss Account 2: A worked example of your solutions to your identified problems in P&L1

Please provide a current statement of each partner’s equity (as required by the Partnership Agreement).

b. The obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The quantitative approach described in the definitions of the terms expected losses, expected residual returns, and expected variability is not required and shall not be the sole determinant as to whether a reporting entity has these obligations or rights.”

* Comments relating to the adequacy of disclosures, the actual descriptions of rate reconciliation items, deferred tax assets and liabilities, uncertain tax positions, timing of reversals, or expiration of net operating losses in various jurisdictions.

3) Based on the data in Exhibit 7 and the definition of operating income gains given