Beth and Debbie are equal owners in Muskrat Enterprises,a calendar year business.During the year,Muskrat had $1 million of gross income and $600,000 of operating expenses.In addition,it sold land that had been held as an investment for a long-term capital gain of $120,000.During the year,Beth and Debbie each received a distribution of $80,000 from Muskrat.Discuss the tax impact of these transactions on the parties involved if Muskrat is:
A)A partnership.
B)An S corporation.
C)A C corporation.

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The Answer of Beth and Debbie are equal owners in Muskrat Enterprises,a calendar year business.During the year,Muskrat had $1 million of gross income and $600,000 of operating expenses.In addition,it sold land that had been held as an investment for a long-term capital gain of $120,000.During the year,Beth and Debbie each received a distribution of $80,000 from Muskrat.Discuss the tax impact of these transactions on the parties involved if Muskrat is:
A)A partnership.
B)An S corporation.
C)A C corporation.

Beth and Debbie Are Equal Owners in Muskrat Enterprises,a Calendar