On January 1, Year 1, Carrot, an individual, paid $20,900 for 5 percent of the stock...

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On January 1, Year 1, Carrot, an individual, paid $20,900 for 5 percent of the stock in Root Corp., an S corporation. In November, he loaned $8,200 to Root Corp. in return for a promissory note. Root Corp. generated a $892,000 operating loss in Year 1. Required: a. How much of his share of the loss can Carrot deduct on his Year 1 return? b. Compute Carrot's basis in his Root Corp. stock and his Root Corp. note at the end of Year 1. X Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A Required B Compute Carrot's basis in his Root Corp. stock and his Root Corp. note at the end of Year 1. Root Stock Root Note Adjusted basis 15,500 < Required A Required B > $ 0 On January 1, Year 1, Carrot, an individual, paid $20,900 for 5 percent of the stock in Root Corp., an S corporation. In November, he loaned $8,200 to Root Corp. in return for a promissory note. Root Corp. generated a $892,000 operating loss in Year 1. Required: a. How much of his share of the loss can Carrot deduct on his Year 1 return? b. Compute Carrot's basis in his Root Corp. stock and his Root Corp. note at the end of Year 1. X Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A Required B Compute Carrot's basis in his Root Corp. stock and his Root Corp. note at the end of Year 1. Root Stock Root Note Adjusted basis 15,500 < Required A Required B > $ 0

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A B 1 a 2 Carrots basis in beginning 2090000 3 ... View the full answer