CCS Corporate Tax Return Problem 5 | P a g e [1] CCSS inventory-related purchases during the year were $302,000 and direct labor of $789,000. It values its inventory based on cost using FIFO inventory cost flow method. CCS must use the 263A method for valuing its inventory for tax purposes the beginning balance of 263A adjustment is $10,000 and the ending value is $5,000. The current year additional 263A costs are $94,000 of the officers salary. [2] CCSs dividend income came from Sinful Desserts, Inc. (SD) CCS owned 10,000 shares of stock in SD at the beginning of the year this represented 16% of SDs outstanding stock. [3] $1,100 was from a City of Irvine bond that was used