Attach to Form $1120,1120-$C$,1120-$F$,112$Overview

You are a senior tax accountant in the firm, Ernest & Rainhouse. Joe, a new junior accountant, has just prepared his first corporate tax return for Zeus, Inc. The electronic filing system has rejected Zeus, Inc.$\text{'}$s Form $1120$: U$.$S$.$ Corporation Income Tax Return $2020[$PDF$]$ Download Zeus, Inc.$\text{'}$s Form $1120$: U$.$S$.$ Corporation Income Tax Return $2020[$PDF$]$due to errors and omissions. Joe is seeking your help in determining his mistakes and in answering some corporate tax questions he is unsure about. You are to read the scenario below and then follow the instructions.

Scenario

Zeus, Inc. is organized as a corporation and is taxed as a C corporation with a calendar year$-$end. Zeus, Inc. owns and operates an amusement park in Los Angeles, California. Zeus, Inc.$\text{'}$s address, employer identification number $($EIN$),$ and date of incorporation are as follows:

Zeus, Inc.

$77$ Sunset Strip.

Los Angeles, CA $90028.$

EIN: $56-1234567.$

Date incorporated: July $1,2010.$

Zeus, Inc. is owned by $77$ shareholders. No person or entity owns directly $20\%$ or more, or owns, directly or indirectly, more than $50\%$ of the voting stock of Zeus, Inc. No one is from outside of the United States.

Zeus, Inc. uses the accrual method of accounting. Zeus, Inc. is not audited by a CPA firm. It does, however, use GAAP$-$based financial statements and has never had a restatement of its income statement.

Zeus, Inc. reported the following information for $2020$:

Zeus, Inc. made payments that required it to file federal form$($s$)1099.$ The $1099$s were filed timely.

Zeus, Inc.$\text{'}$s average annual gross receipts for the prior three years are under $$26,000,000.$

Zeus, Inc. elects to file a complete Schedule M$-3$ even if only M$-1,$ or a partial M$-3,$ is required.

Additional Information Used in the Preparation of Zeus, Inc. Financial Statements:

On August $1,2020,$ Zeus, Inc. was notified by its legal counsel that Zeus, Inc. was being sued by a former employee regarding her termination of employment from Zeus, Inc. On December $21,2020,$ a legal settlement was reached with this terminated employee. As part of the settlement, Zeus agreed to pay the employee a settlement amount of $$190,000$ on January $10,2021.$ Zeus, Inc. accrued this expense on its $2020$ financial statements.

Zeus, Inc. owns $12\%$ of Fun Fair of Russia, a Russian corporation operating a theme park on the outskirts of Moscow. Fun Fair of Russia remitted dividends to Zeus, Inc. of $$14,000.$ Zeus, Inc. also received $$300$ in dividends from holding marketable securities $($all less than $20\%$ owned by Zeus, Inc.$).$

From its inception until this year, Zip Coaster has been Zeus' main attraction, but it aged and lost appeal. Zeus, Inc. purchased a new attraction known as the Swirlwind. The Swirlwind was installed and placed in operation on March $1,2020,$ at a cost of $$6,000,000$ to acquire and place into service.

Zeus, Inc. rents its amusement equipment from vendors. As of December $31,2019,$ and December $31,2020,$ respectively, Zeus, Inc. has prepaid vendors for equipment rental of $$30,000$ for January $2020$ and $$35,000$ for January $2021.$

On December $26,2020,$ Zeus, Inc. prepaid a contractor $$17,500$ to repair three pieces of maintenance shop equipment. Zeus, Inc. fully expects that the contractor will have completed the project by January $31,2020.$

As of December $31,2019,$ and $2020,$ respectively, Zeus, Inc. had vacation accruals on its books of $$29,000$ and $$35,000.$

On December $2,2020,$ Zeus, Inc. held an advertising giveaway of $$100,000.$

Zeus, Inc. rents part of its unused land. Zeus, Inc. received a check for $$50,000$ on December $27,2020,$ for a $6-$month rental beginning January $1,2021.$ The lease contains a clause that the rent is nonrefundable to the renter under any circumstances.

During the year, Zeus, Inc. made the following estimated tax payments:

Estimated Tax Payments

Date Federal Estimated Tax Payment California Estimated Tax Payment

$4/15/2020$ $$72,500$ $$15,000$

$6/15/2020$ $$72,500$ $$15,000$

$9/15/2020$ $$72,500$ $$15,000$

$12/15/2020$ $$72,500$ $$15,000$

On December $1,2020,$ Zeus Inc. paid $$400,000$ in dividends to all common stockholders.

Additional Information Used in the Preparation of Zeus, Inc. Corporate Tax Return:

Zeus, Inc. maintains a portfolio of tax$-$exempt securities and publicly traded stocks as a measure to provide immediate liquidity if needed. All of these securities originate from less than $20\%$ owned domestic corporations. Zeus, Inc. paid an attorney $$10,000$ to obtain the tax$-$exempt securities$.$

Zeus's regular tax depreciation for the year is correctly calculated as $$1,112,499($from the previous year's purchases$)$ before considering the $2020$ addition of Swirlwind. Because of the Swirlwind's modular design, it is considered personal property. $($Not real property.$)$

Near the end of the year, Zeus, Inc. switched its property and casualty insurance company. As a result, the plan year for its insurance contract was altered. On December $31,2020,$ Zeus, Inc. prepaid insurance premiums of $$25,000$

Basically, I need the tax forms filled out correctly so that I can compare them to the forms I filled out and the examples I was given so that I can make sure I$\text{'}$m correct when I write the $3$ page paper. I don't need you to point out mistakes or anything, just give me an exmplar I can use to check my work. Thanks in advance!!!