Alex,Ellen and Nicolas Are Equal Partners in a Local Restaurant

Multiple Choice

Alex,Ellen and Nicolas are equal partners in a local restaurant.The restaurant reports the following items for the current year: $\begin{array}{lr}\text { Business revenue } & \$ 770,000 \\\text { Business expenses } & 470,000 \\\text { Investment expenses } & 150,000\end{array}$ Each partner receives a Schedule K-1 with one-third of the preceding items reported to him/her.How must each individual report these results on his/her Form 1040?

A) $100,000 income on Schedule E;$50,000 investment expense on Schedule A
B) $257,667 income on Schedule E;$50,000 investment expense on Schedule A
C) $300,000 income on Schedule E;$50,000 investment expense on Schedule A
D) $300,000 income on Schedule E;$150,000 investment expense on Schedule A