13. Assume Warren Buffett has decided to purchase a professional hockey team to play in Omaha. The?

... team is structured as an S corporation and costs $400 million. In year one, the team had $110 million of revenue and $100 million of operating expenses. Mr. Buffett is in the 35% tax bracket.

What amount will be reported as net income (loss) on the income statement for the first year of Mr. Buffett’s ownership? (12 points)

How much is the total cash benefit of the hockey team to Mr. Buffett’s portfolio?