I:16-64 The financial accounting balance sheet for Zane, a retail sales corporation, as of the end of the current year (2021) is as follows:

Assets Cash $ 50,000 Accounts receivable 20,000 Inventory 10,000 Land 20,000 Buildings (net of $30,000 accumulated depreciation) 100,000 Equipment (net of $50,000 accumulated depreciation) 150,000 Intangibles 60,000 Total assets $410,000 Liabilities & Owner’s Equity Accounts payable $ 40,000 Mortgage payable (short-term) 40,000 Long-term debt 60,000 Capital stock 100,000 Retained earnings 170,000a Total liabilities and stockholders’ equity $410,000 aThe retained earnings balance at the beginning of the current year was $70,000. Beginning inventory was $15,000.

Dividends in the amount of $14,000 were paid.

Using the accrual method Zane reports the following financial accounting operating results for the current year:

Sales $550,000 Minus: Costs of goods sold (350,000)

Gross profit $200,000 Dividend income from a 20%-owned domestic corporation 75,000 Net long-term capital gain 150,000 Total income $425,000 Expenses:

Salaries (including officer’s salary of $40,000) $120,000 Repairs 30,000 Bad debts 10,000 State and local taxes 20,000 Amortization 5,000 Contributions 46,000 Depreciation (straight-line) 40,000 Total expenses (before federal income tax expense) $271,000 Operating profit $154,000 Minus: Provision for federal income taxes (40,000)

Net income $114,000 All dividends qualify for the dividends-received deduction. In addition, the following items should be taken into account:
Current-year estimated tax payments $15,000 MACRS depreciation for tax purposes 60,000 Prepare a current year Form 1120 (U.S. Corporation Income Tax Return) for Zane.
Disregard beginning-of-the-year balance sheet amounts other than retained earnings. Also, leave spaces blank on Form 1120 for information not provided.