Brad Is a 40% Member in the BB LLC

Multiple Choice

Brad is a 40% member in the BB LLC. At the beginning of the tax year, Brad's capital account showed a balance of $120,000. In this case, his capital account equals his basis in the LLC interest excluding his share of the LLC's debts. His prior year Schedule K-1 showed recourse debt (guaranteed by Brad) and nonrecourse debt of $10,000 and $20,000, respectively. During the current year, BB reported net ordinary income of $200,000 and non-deductible expenses of $2,000. There were no distributions during the year. At the end of the year, Brad's current year Schedule K-1 showed recourse (guaranteed) and nonrecourse debt of $20,000 and $30,000, respectively. How much is Brad's basis in the LLC interest at the end of the year?

A) $199,200.
B) $200,000.
C) $220,000.
D) $249,200.
E) $250,000.