Reference no: EM132485805

Cougar, Inc., is a calendar year S corporation. Cougar's For 1120S shows nonseparately stated ordinary income of $80,000 for the year. Johnny owns 40% of the cougar stock throughout the year. The following information is obtained from the corporate records.

Tax-exempt interest income                                   $ 3,000

Salary paid to Johnny                                        $ (52,000)

Charitable contributions                                      $ (6,000)

Dividends received from a non-U.S. corporation       $ 5,000

Short-term capital loss                                      $ (6,000)

Depreciation recapture income                             $ 11,000

Refund of prior state income taxes                        $ 5,000

Cost of goods sold                                          $ (72,000)

Long-term capital loss                                       $ (7,000)

Administrative expenses                                   $ (18,000)

Long-term capital gain                                       $ 14,000

Selling expenses                                             $ (11,000)

John's beginning stock basis                                $ 32,000

Johnny's additional stock purchases                        $ 9,000

Beginning AAA                                                   $ 31,000

Johnny's loan to corporation                                  $ 20,000

Question ?A. Compute Cougar's book income or loss. (please show all calculations)

Question B. Compute Johnny's ending stock basis. (please show all calculations)

Question C. Calculate Cougar's ending AAA balance (please show all calculations)