Ariodante, Inc., is a Florida Corporation which uses the accrual-method basis of accounting. For its most recent year it reported taxable income of $2,550,000.00.

Making up the computation of taxable income were the following items.

Earnings and Profits Depreciation of $250,000.00

Corresponding MACRS Depreciation was $150,000.00

A Net capital Loss Carryover of $ 15,000.00

A Net Operating Loss Carryover of $ 30,000.00

A capital gain from the distribution of Land

(see below)

Not included in the computation of

taxable income were the following items:

Tax Exempt Income $ 10,000.00

Life Insurance Proceeds $300,000.00

Excess current year charitable contribution

to be carried over to next year $ 3,000.00

Tax-deferred gain of $25,000

on a like-kind exchange $ 25,000.00

Nondeductible life insurance premium $ 4,500.00

Nondeductible interest expense $ 1,000.00

At the Beginning of the corporations accounting year

E&P was $2,500,000.00

During the Accounting Year Ariodante, Inc., made

The following distributions:

Cash Distribution to Shareholders of $ 75,000.00

Distribution of Property subject to

Indebtedness to shareholders in equal shares

FMV or Property: $90,000.00

Basis of Property $15,000.00

Mortgage (assumed equally by Shareholders) $25,000.00

Fill out a form 1120 and schedule M-1. Include in answer the box numbers that align with the values on the tax return.