At the beginning of 2020, Ms. Pope purchased a 20 percent interest in PPY Partnership...
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Accounting
At the beginning of 2020, Ms. Pope purchased a 20 percent interest in PPY Partnership for $23,000. Ms. Popes Schedule K-1 reported that her share of PPYs debt at year-end was $26,000, and her share of ordinary loss was $44,400. On January 1, 2021, Ms. Pope sold her interest to another partner for $3,400 cash.
Required:
A. How much of her share of PPYs loss can Ms. Pope deduct on her 2020 return?
B. Compute Ms. Popes recognized gain on sale of her PPY interest.
C. How would your answers to parts a and b change if PPY were an S corporation instead of a partnership?
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