Phil Williams and Liz Johnson are 60% and 40% shareholders, respectively, in WJ Corporation, a Subchapter S corporation. The corporation had the following activity during the year:
Income ................................................................................................$336,123
Interest income...........................................................................................1,259
Dividend income (qualified) ...........................................................................4,586
Long-term capital gains................................................................................13,458
Total revenue........................................................................................$355,426
Expenses
Salaries and wages (nonofficers) ................................................................ $ 47,000
Salaries and wages, owners and officers.........................................................125,000
Depreciation (MACRS-includes $9,000 § 179 expense) ......................................41,888
Interest expense.........................................................................................5,220
Taxes and licenses....................................................................................15,548
Meals and entertainment (100%)..................................................................15,257
Auto......................................................................................................5,254
Insurance (nonofficer health) ........................................................................6,000
Accounting and legal...................................................................................2,800
Repairs...................................................................................................1,200
Charitable contributions...............................................................................2,500
Payroll penalties..........................................................................................500
Total expenses .....................................................................................$268,167
Net income..........................................................................................$87,259
During the year, the corporation made a distribution of $20,000, in total, to its shareholders. Complete page 1, Schedule K, and Schedule M-1 of Form 1120S.
(Enter all amounts as positive unless otherwise indicated in the forms themselves. Round your intermediate computations to the nearest whole dollar value.)
1120S pages 1 - 4 to be completed.....