How to count this measure?

Question

I am learning a piece and am new to sheet music. I am trying to count the beats, and need to some help in counting. It's in the time signature 4/4.
For the second bar, how should I count it out?

My interpretation:

 (0 3) 1 & beat 
 0--    ?
 2---   ?
 (3 0) 1  & beat

Answer 1

(0 3)   1 &
(0 2)   2 & 3 &
(3 0)   4 &

Answer 2

I assume this is plucked guitar strings without any active muting. Hence the notes will continue to ring out, but won't really be "held" in the same sense the other instrument might do.

I'm not sure why it's been written the way shown (as two seperate voice), but if you rewrite it as a single voice (removing the unnecessary tied notes etc.), it is much easier to see the rhythm:

(PS I don't understand your notation at all.)