A trial balance for the corporation is attached. Additional information is presented below.

1. Razorback Sports has a capital loss carry over from last year of 1,755

2. Interest income:

a. From a City of Fayetteville bond that was used to fund new police station 7,488

b. From a U.S. Treasury bond 4,007

c. From a money market account 6,055

3. Razorback Sports sold equipment.

a. Selling price 12,519

b. Original purchase price 17,433

c. Total book depreciation on the equipment 6,728

d. Total tax depreciation on the equipment 10,062

4. Razorback Sports' dividend income came from Cardinal Inc. Razorback Sports owned 25,000 shares of the stock in Cardinal at the beginning of the year. This represented 12% of the Cardinal outstanding stock.

5. On July 22, 2019 Razorback Sports sold 2,500 shares of its Cardinal Inc. stock.

a. Selling price 29,250

b. Razorback originally purchased these shares on April 24, 2016 16,380

c. After the sale, Razorback Sports owned 8.5% of Cardinal Inc.

6. Interest expense:

a. From the mortgage on Razorback Sports' building 72,540

The business expense limit does not apply to Razorback Sports

7. Wages to non-officers are 760,500

8. Pension expense is the same for both book and tax purposes.

9. Miscellaneous expenses include premiums paid on term life insurance policies on the lives of Austin and Tyler (Razorback Sports is the beneficiary of the life insurance policies). 4,007

10. The corporation uses MACRS depreciation for tax purposes. The corporation purchased all of its equipment on July 1, 2016. Razorback Sports took the maximum amount of 179 depreciation (no bonus depreciation). The equipment is all 7 year property.

a. Cost of the equipment 877,500

11. Accounts receivable written off by Razorback Sports during the year were 50,310

12. On December 1, 2019 Razorback Sports paid a dividend to its shareholders of 93,600

13. Razorback Sports made four equal estimated tax payments of 44,460

a. If it has overpaid its federal tax liability, Razorback would like to receive a refund.

14. The corporation paid the following compensation to its officers:

Austin Williams 356,850

Tyler Jacobs 286,650

Kellie Francis 140,400

Jason Roberts 105,300

15. All officers devote 100% of their time to the business and all officers are U.S. citizens.

16. Neither Kellie nor Jason owns any stock in Razorback Sports.

Credit:Accounts payable318,825

Debit:Accounts receivable819,000

Credit:Accumulated depreciation438,750

Debit:Advertising expense63,180

Credit:Allowance for doubtful accounts61,952

Debit:Bad debt expense40,950

Credit:Capital gains12,870

Credit:Capital stock (common)1,053,000

Debit:Cash396,864

Debit:Charitable contributions31,590

Debit:Compensation expense1,649,700

Debit:Cost of goods sold905,580

Debit:Depreciation expense29,250

Debit:Dividends (paid)93,600

Credit:Dividends (received)14,040

Debit:Entertainment expense2,223

Debit:Equipment877,500

Debit:Federal income tax expense293,436

Credit:Gain from disposition of fixed assets1,931

Debit:Interest expense72,540

Credit:Interest income17,550

Debit:Inventory1,989,000

Debit:Investments in state & local bonds163,800

Debit:Investments in stock321,750

Debit:Investment in U.S. government bonds81,900

Debit:Land3,217,500

Debit:Maintenance expense29,250

Debit:Meals expense3,920

Debit:Miscellaneous expense47,970

Credit:Mortgage payable1,799,811

Debit:Other assets323,154

Credit:Other current liabilities146,250

Credit:Other liabilities207,090

Debit:Other taxes expense76,050

Debit:Pension plans expense49,140

Debit:Professional services expense37,440

Debit:Property tax expense52,650

Credit:Retained earnings (1/1/2019)3,708,900

Credit:Sales4,012,223

Debit:Sales returns & allowance44,460

Debit:State income tax expense70,200

Debit:Supplies expense9,594

Totals:$11,793,191$11,793,191