Corporation tax return form 1120 . I am trying to do this. But i need check if the final answer is correct.

BOOK BALANCE SHEETS Account Cash Accounts receivable Allowance for doubtful accounts Inventory Investment in corporate stock Investment in municipal bonds Net current deferred tax asset Cash surrender value of incurance policy Land Buildings Acc. depreciation - buildings Equipment & fixtures Acc. depreciation - equipment & fixtures Trucks Acc. depreciation - trucks Accounts payable Short-term notes payable Accured payroll taxes Accrued state income taxes Accrued federal income taxes Long-term bonds payable Net noncurrent deferred tax liability Common Stock Retained earnings-unappropriated TOTAL January 1, 2015 Debit Credit $243,116 441,180 $22,059 2,375,000 265,000 32,000 10,220 42,000 300,000 1,400,000 70,000 960,000 160,000 250,000 75,000 300,000 610,000 14,250 8,550 2,000,000 158,657 900,000 _________ 2,000,000 $6,318,516 $6,318,516 December 31, 2015 Debit Credit $177,823 513,000 $25,650 3,325,000 110,000 32,000 8,721 54,000 300,000 1,400,000 98,000 2,640,000 249,333 250,000 125,000 270,000 488,000 17,812 14,250 17,693 2,300,000 284,588 900,000 _________ 4,020,218 $8,810,544 $8,810,544 BOOK INCOME STATEMENT FOR 2015 Sales Returns Net sales Beginning inventory Purchases Ending inventory Cost of goods sold Gross Profit Expenses: Amortization Depreciation Repairs General insurance premiums Officers' life insurance premiums Officers' compensation Other salaries Utilities Advertising Legal and accounting fees Charitable contributions Payroll taxes Interest expense Bad debt expense Total expenses Dividend income Interest income on municipal bonds Net gain on stock sales Net income before income taxes Federal income tax expense State income tax expense Net income $9,500,000 237,500 $9,262,500 $2,375,000 5,225,000 3,325,000 4,275,000 $4,987,500 0 $231,333 19,760 52,250 42,750 617,500 380,000 68,400 45,600 47,500 28,500 59,375 199,500 41,591 $1,834,059 11,400 4,750 122,000 $3,291,591 1,105,123 71,250 $2,115,218 Book-Tax Reconciliation for Schedule M-1 Sales Returns Net sales Cost of goods sold Gross Profit Interest income on municipal bonds Dividend income Net gain on stock sales Depreciation Repairs General insurance premiums Officers' life insurance premiums Officers' compensation Other salaries Utilities Advertising Legal and accounting fees Charitable contributions Payroll taxes Interest expense Bad debt expense Total expenses BOOK $9,500,000 237,500 $9,262,500 4,275,000 $4,987,500 4,750 11,400 122,000 $231,333 19,760 52,250 42,750 617,500 380,000 68,400 45,600 47,500 28,500 59,375 199,500 41,591 1,834,059 Income before Income Tax State income taxes $3,291,591 ($71,250) Federal income tax expense 1,105,123 Net income $2,115,218 TAX DIFFERENCE ACC 404 Corporate Tax Return Project - Summer 2016 Using the following information, prepare a corporate tax return for 2015. It is due on Monday, August 1, 2016. You may work on it in a group with up to two other students (maximum of 3 students per group). Print your name (or the names of your team members) on a cover page and staple in the top left corner (no other cover is required). You can download the tax forms from the IRS website (www.irs.gov). In addition to the basic Form 1120 (all 5 pages), you will need to complete (1) a \"white paper schedule\" showing the details when several items need to be added together but the forms do not have space to report the detail or anywhere the forms state \"attach schedule\" (such as \"other deductions on line 26 of the Form 1120) and (2) your multicolumn booktax reconciliation showing how you determined the items that are reported on Schedule M1 (similar to Example C:351 on page 341 of your textbook). You do not need to compute any underpayment penalty and do not need to attach any other forms. Kailua Surf & Swim, Inc. is located at 5432 Lunalilo Road, Kahala, Hawaii 96816. The corporation uses the calendar year and accrual basis for both book and tax purposes. It is engaged in the retail sale of surfing equipment and clothing. Its employer identification number is 651234567. It is not a subsidiary or member of a control group and does not own any foreign entities. The company incorporated on December 31, 2011 and began business on January 1, 2012. The book balance sheet at January 1, 2015 and December 31, 2015 are included in a separate excel file along with the book income statement for 2015. The corporation made estimated federal income tax payments of $960,000 during 2015. Organizational expenditures: The corporation incurred $11,000 of organizational expenditures on January 1, 2012. For book purposes, the corporation expensed the entire amount in 2012. For tax purposes, the corporation elected under Section 248 to deduct $5,000 in 2012 and amortize the remaining $6,000 over 180 months. The corporation reports this amortization on Form 4562 but includes it in \"other deductions\" on Form 1120, Line 26. Bad Debts: For tax purposes, the corporation uses the direct write off method of deducting bad debts. For book purposes, the corporation uses the allowance method. During 2015, the corporation charged $38,000 to the allowance account; this is the amount of actual write offs for 2015. Capital gains and losses: The corporation sold two blocks of stock this year. One resulted in a $134,000 shortterm capital gain and the other resulted in a $12,000 longterm capital loss. The corporation also has an $8,000 capital loss carryover from 2015. Depreciation: For book purposes, the corporation uses straightline depreciation over the useful lives of assets; this is reflected in the book financial statements. For tax purposes, all assets are MACRS property and the tax depreciation expense for 2015 is $601,318. Other information: The corporation is owned by 3 individual shareholders. One individual owns 50% of the stock and the other two shareholders each own 25%. The corporation paid $95,000 in cash dividends to its shareholders during 2015 and charged the payment directly to retained earnings. This was considered a dividend paid out of earnings & profits for tax purposes. The corporation received dividends from taxable, domestic corporations in which it owns 12%. 1 The state income tax shown in the book financial statements is the same amount of taxes actually incurred during the year. Ignore the AMT and accumulated earnings tax. The corporation is not entitled to any tax credits. The corporation had no Section 1231 gains or losses in prior years and no net operating losses. The corporation did not issue any debt instruments with original issue discount. The corporation is not required to file Schedule UTP. The corporation did file all appropriate Forms 1099 for the year. The corporation did not have any change in ownership during the year and did not dispose of more than 65% of the value of its assets. The corporation did not receive any assets in a Section 351 transfer with a FMV in excess of $1 million. The corporation does not qualify for the domestic production activities deduction. The tax liability owed (that should be reported on line 34 on page 1 of Form 1120) is equal to the amount of accrued federal income taxes reported on the balance sheet. You do not need to determine any underpayment penalty. In assembling the information to prepare Schedule M1, I encourage you to do your reconciliation (getting from book to taxable income) in excel, but please remember to print it out and attach it to your return. The number shown on line 10 of Schedule M1 must agree with the number shown on page 1, line 28 of Form 1120. Dollar amounts are all rounded to the nearest dollar. Do not show \"00\" for the pennies; just leave the area blank. If there is no dollar amount for a particular line, you can just leave it blank. 2 1120 U.S. Corporation Income Tax Return Form Department of the Treasury Internal Revenue Service A Check if: 1a Consolidated return (attach Form 851) . b Lifeonlife consolidated return . . . 2 Personal holding co. (attach Sch. PH) . . For calendar year 2015 or tax year beginning TYPE OR PRINT Income Deductions (See instructions for limitations on deductions.) Name B Employer identification number Number, street, and room or suite no. If a P.O. box, see instructions. C Date incorporated City or town, state, or province, country, and ZIP or foreign postal code D Total assets (see instructions) $ E Check if: (1) (2) Initial return (3) Final return (4) Name change Address change . . . . . . . . . . . . 1a 2 3 4 Returns and allowances . . . . . Balance. Subtract line 1b from line 1a Cost of goods sold (attach Form 1125-A) Gross profit. Subtract line 2 from line 1c Dividends (Schedule C, line 19) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1b . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1c 2 3 4 5 6 7 Interest . . Gross rents . Gross royalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 6 7 8 9 10 Capital gain net income (attach Schedule D (Form 1120)) . . . . Net gain or (loss) from Form 4797, Part II, line 17 (attach Form 4797) Other income (see instructionsattach statement) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 9 10 11 12 13 Total income. Add lines 3 through 10 . . . . . . . . Compensation of officers (see instructionsattach Form 1125-E) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 15 16 Salaries and wages (less employment credits) Repairs and maintenance . . . . . . Bad debts . . . . . . . . . . . Rents . . . . . . . . . . . . 11 12 13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 15 16 17 18 19 Taxes and licenses . . Interest . . . . . Charitable contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 18 19 20 21 22 Depreciation from Form 4562 not claimed on Form 1125-A or elsewhere on return (attach Form 4562) . Depletion . . . . . . . . . . . . . . . . . . . . . . . . . . . . Advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 21 22 23 24 25 Pension, profit-sharing, etc., plans . . . . . . . . Employee benefit programs . . . . . . . . . . Domestic production activities deduction (attach Form 8903) . . . . 23 24 25 26 27 28 Other deductions (attach statement) . . . . . . . . . . . . . . . . . . . . . Total deductions. Add lines 12 through 26 . . . . . . . . . . . . . . . . . . . Taxable income before net operating loss deduction and special deductions. Subtract line 27 from line 11. 29a b Net operating loss deduction (see instructions) . Special deductions (Schedule C, line 20) . . . b c Tax, Refundable Credits, and Payments 2015 , 20 . 4 Schedule M-3 attached 1a , 2015, ending Information about Form 1120 and its separate instructions is at www.irs.gov/form1120. 3 Personal service corp. (see instructions) . OMB No. 1545-0123 c 30 31 32 33 34 35 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Add lines 29a and 29b . . . . . . . . . . . . . Taxable income. Subtract line 29c from line 28 (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 27 28 29a 29b . . . . . . . . . . . . 29c 30 Total tax (Schedule J, Part I, line 11) . . . . . . . . . . . . . . . . Total payments and refundable credits (Schedule J, Part II, line 21) . . . . . . . Estimated tax penalty (see instructions). Check if Form 2220 is attached . . . . . Amount owed. If line 32 is smaller than the total of lines 31 and 33, enter amount owed . . . . . . . . . . . . . . . . 31 32 33 34 Overpayment. If line 32 is larger than the total of lines 31 and 33, enter amount overpaid Enter amount from line 35 you want: Credited to 2016 estimated tax . . . . . Refunded . . . . . . 35 36 Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge. Date Signature of officer Paid Preparer Use Only Print/Type preparer's name Preparer's signature Sign Here Gross receipts or sales . May the IRS discuss this return with the preparer shown below (see instructions)? Yes No Title Date Check if self-employed Firm's name Firm's EIN Firm's address Phone no. For Paperwork Reduction Act Notice, see separate instructions. Cat. No. 11450Q PTIN Form 1120 (2015) Page 2 Form 1120 (2015) Schedule C Dividends and Special Deductions (see instructions) (a) Dividends received (b) % 1 Dividends from less-than-20%-owned domestic corporations (other than debt-financed stock) . . . . . . . . . . . . . . . . . . . . . . . . 70 2 Dividends from 20%-or-more-owned domestic corporations (other than debt-financed stock) . . . . . . . . . . . . . . . . . . . . . . . . 80 3 Dividends on debt-financed stock of domestic and foreign corporations . . . . . 4 Dividends on certain preferred stock of less-than-20%-owned public utilities . . . 42 5 Dividends on certain preferred stock of 20%-or-more-owned public utilities . . . . 48 6 Dividends from less-than-20%-owned foreign corporations and certain FSCs . . . 70 7 Dividends from 20%-or-more-owned foreign corporations and certain FSCs . . . 80 8 Dividends from wholly owned foreign subsidiaries 100 9 Total. Add lines 1 through 8. See instructions for limitation . . . . . . . . . . . . . . . . . . . see instructions 10 Dividends from domestic corporations received by a small business investment company operating under the Small Business Investment Act of 1958 . . . . . 100 11 Dividends from affiliated group members . . . . . . . . . . . . . . 100 12 Dividends from certain FSCs . . . . . . . . . . . . . 100 13 Dividends from foreign corporations not included on lines 3, 6, 7, 8, 11, or 12 . . . 14 Income from controlled foreign corporations under subpart F (attach Form(s) 5471) 15 Foreign dividend gross-up . . . . . . . 16 IC-DISC and former DISC dividends not included on lines 1, 2, or 3 . . . . . . 17 Other dividends . . . . . . 18 Deduction for dividends paid on certain preferred stock of public utilities . . . . 19 Total dividends. Add lines 1 through 17. Enter here and on page 1, line 4 . . . 20 Total special deductions. Add lines 9, 10, 11, 12, and 18. Enter here and on page 1, line 29b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (c) Special deductions (a) (b) . . . . . . . Form 1120 (2015) Page 3 Form 1120 (2015) Schedule J Tax Computation and Payment (see instructions) Part I-Tax Computation 1 2 3 Check if the corporation is a member of a controlled group (attach Schedule O (Form 1120)) . Income tax. Check if a qualified personal service corporation (see instructions) . . . . Alternative minimum tax (attach Form 4626) . . . . . . . . . . . . . . . . . . . . . . . . . . 4 5a b Add lines 2 and 3 . . . . . . . . Foreign tax credit (attach Form 1118) . . Credit from Form 8834 (see instructions) . . . . . . 3 4 . . . . . . . . . . . . 6 7 . . 9a . . . . . 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . General business credit (attach Form 3800) . . . Credit for prior year minimum tax (attach Form 8827) Bond credits from Form 8912 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 7 Total credits. Add lines 5a through 5e Subtract line 6 from line 4 . . . . . . . . . . . . . . . . . . . . . . . . 8 9a Personal holding company tax (attach Schedule PH (Form 1120)) . Recapture of investment credit (attach Form 4255) . . . . . . . . . . . . . . . . b Recapture of low-income housing credit (attach Form 8611) . . . . . c Interest due under the look-back methodcompleted long-term contracts (attach Form 8697) . . . . . . . . . . . . . . . . . . . . . . 9c d Interest due under the look-back methodincome forecast method 8866) . . . . . . . . . . . . . . . . . . . Alternative tax on qualifying shipping activities (attach Form 8902) . Other (see instructionsattach statement) . . . . . . . . 9d 9e 9f c d e e f 10 11 . . . . . . . . . . . . . . . . Total. Add lines 9a through 9f . . . . . . . . . . . . Total tax. Add lines 7, 8, and 10. Enter here and on page 1, line 31 . (attach . . . . . . . . . 5a 5b 2 5c 5d 5e . . 9b Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 11 Part II-Payments and Refundable Credits 12 13 2014 overpayment credited to 2015 2015 estimated tax payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 13 14 15 16 2015 refund applied for on Form 4466 . Combine lines 12, 13, and 14 . . . Tax deposited with Form 7004 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 ( 15 16 17 18 Withholding (see instructions) . . . . Total payments. Add lines 15, 16, and 17 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 18 19 Refundable credits from: Form 2439 . . . . . . . . . . . . . . . . . . 20 Form 4136 . . . . . . . . . . Form 8827, line 8c . . . . . . . Other (attach statementsee instructions). Total credits. Add lines 19a through 19d . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19a 19b 19c 19d . . . . . . . . 21 Total payments and credits. Add lines 18 and 20. Enter here and on page 1, line 32 . . . . . . 20 21 a b c d Schedule K . . . . Other Information (see instructions) 1 Check accounting method: a 2 a b See the instructions and enter the: Business activity code no. Business activity c Product or service Cash b Accrual c . Other (specify) 3 Is the corporation a subsidiary in an affiliated group or a parent-subsidiary controlled group? If \"Yes,\" enter name and EIN of the parent corporation 4 At the end of the tax year: a b . ) Yes . . . . . . . . . No . Did any foreign or domestic corporation, partnership (including any entity treated as a partnership), trust, or tax-exempt organization own directly 20% or more, or own, directly or indirectly, 50% or more of the total voting power of all classes of the corporation's stock entitled to vote? If "Yes," complete Part I of Schedule G (Form 1120) (attach Schedule G) . . . . . . Did any individual or estate own directly 20% or more, or own, directly or indirectly, 50% or more of the total voting power of all classes of the corporation's stock entitled to vote? If "Yes," complete Part II of Schedule G (Form 1120) (attach Schedule G) . Form 1120 (2015) Page 4 Form 1120 (2015) Schedule K Other Information continued (see instructions) Yes 5 No At the end of the tax year, did the corporation: a Own directly 20% or more, or own, directly or indirectly, 50% or more of the total voting power of all classes of stock entitled to vote of any foreign or domestic corporation not included on Form 851, Affiliations Schedule? For rules of constructive ownership, see instructions. If \"Yes,\" complete (i) through (iv) below. (i) Name of Corporation (ii) Employer Identification Number (if any) (iv) Percentage Owned in Voting Stock (iii) Country of Incorporation b Own directly an interest of 20% or more, or own, directly or indirectly, an interest of 50% or more in any foreign or domestic partnership (including an entity treated as a partnership) or in the beneficial interest of a trust? For rules of constructive ownership, see instructions. If \"Yes,\" complete (i) through (iv) below. (i) Name of Entity 6 (ii) Employer Identification Number (if any) (iv) Maximum Percentage Owned in Profit, Loss, or Capital (iii) Country of Organization During this tax year, did the corporation pay dividends (other than stock dividends and distributions in exchange for stock) in excess of the corporation's current and accumulated earnings and profits? (See sections 301 and 316.) . . . . . . . If "Yes," file Form 5452, Corporate Report of Nondividend Distributions. If this is a consolidated return, answer here for the parent corporation and on Form 851 for each subsidiary. 7 At any time during the tax year, did one foreign person own, directly or indirectly, at least 25% of (a) the total voting power of all classes of the corporation's stock entitled to vote or (b) the total value of all classes of the corporation's stock? . . . . For rules of attribution, see section 318. If \"Yes,\" enter: (i) Percentage owned and (ii) Owner's country 8 (c) The corporation may have to file Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business. Enter the number of Forms 5472 attached Check this box if the corporation issued publicly offered debt instruments with original issue discount . . . . . . 9 10 If checked, the corporation may have to file Form 8281, Information Return for Publicly Offered Original Issue Discount Instruments. Enter the amount of tax-exempt interest received or accrued during the tax year $ Enter the number of shareholders at the end of the tax year (if 100 or fewer) 11 If the corporation has an NOL for the tax year and is electing to forego the carryback period, check here 12 If the corporation is filing a consolidated return, the statement required by Regulations section 1.1502-21(b)(3) must be attached or the election will not be valid. Enter the available NOL carryover from prior tax years (do not reduce it by any deduction on line 29a.) $ 13 . . . . . Are the corporation's total receipts (page 1, line 1a, plus lines 4 through 10) for the tax year and its total assets at the end of the tax year less than $250,000? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . If \"Yes,\" the corporation is not required to complete Schedules L, M-1, and M-2. Instead, enter the total amount of cash distributions and the book value of property distributions (other than cash) made during the tax year $ 14 15a b Is the corporation required to file Schedule UTP (Form 1120), Uncertain Tax Position Statement (see instructions)? If \"Yes,\" complete and attach Schedule UTP. Did the corporation make any payments in 2015 that would require it to file Form(s) 1099? . . . . . . . If \"Yes,\" did or will the corporation file required Forms 1099? . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 During this tax year, did the corporation have an 80% or more change in ownership, including a change due to redemption of its own stock? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 During or subsequent to this tax year, but before the filing of this return, did the corporation dispose of more than 65% (by value) of its assets in a taxable, non-taxable, or tax deferred transaction? . . . . . . . . . . . . . . . . . . 18 Did the corporation receive assets in a section 351 transfer in which any of the transferred assets had a fair market basis or fair market value of more than $1 million? . . . . . . . . . . . . . . . . . . . . . . . . . . . Form 1120 (2015) Page 5 Form 1120 (2015) Schedule L Balance Sheets per Books Beginning of tax year (a) Assets 1 . . . 2a b 3 4 5 6 7 8 9 10a b 11a b 12 13a b 14 15 Cash Trade notes and accounts receivable . Less allowance for bad debts . . . Inventories . . . . . . . . . U.S. government obligations . . . Tax-exempt securities (see instructions) Other current assets (attach statement) Loans to shareholders . . . . . Mortgage and real estate loans . . . Other investments (attach statement) . Buildings and other depreciable assets Less accumulated depreciation . . . Depletable assets . . . . . . . Less accumulated depletion . . . . Land (net of any amortization) . . . Intangible assets (amortizable only) . Less accumulated amortization . . . Other assets (attach statement) . . . Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 17 18 19 20 21 22 Accounts payable . . . . . . . . . Mortgages, notes, bonds payable in less than 1 year Other current liabilities (attach statement) . . Loans from shareholders . . . . . . . Mortgages, notes, bonds payable in 1 year or more Other liabilities (attach statement) . . . . Capital stock: a Preferred stock . . . . b Common stock . . . . Additional paid-in capital . . . . . . . Retained earningsAppropriated (attach statement) Retained earningsUnappropriated . . . Adjustments to shareholders' equity (attach statement) Less cost of treasury stock . . . . . . Total liabilities and shareholders' equity . . End of tax year (b) (c) (d) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) Liabilities and Shareholders' Equity 23 24 25 26 27 28 Schedule M-1 ( ) ( ) Reconciliation of Income (Loss) per Books With Income per Return Note: The corporation may be required to file Schedule M-3 (see instructions). 1 Net income (loss) per books . . . . . . 2 Federal income tax per books . . . . . 3 Excess of capital losses over capital gains 4 Income subject to tax not recorded on books this year (itemize): 5 Expenses recorded on books this year not deducted on this return (itemize): a b c 6 4 Income recorded on books this year not included on this return (itemize): Tax-exempt interest $ 8 Deductions on this return not charged against book income this year (itemize): a Depreciation . . $ b Charitable contributions $ 9 10 Add lines 7 and 8 . . . . . . Income (page 1, line 28)line 6 less line 9 . Depreciation . . . . $ Charitable contributions . $ Travel and entertainment . $ Add lines 1 through 5 . Schedule M-2 1 2 3 7 . . . . . . . Analysis of Unappropriated Retained Earnings per Books (Line 25, Schedule L) Balance at beginning of year Net income (loss) per books . Other increases (itemize): Add lines 1, 2, and 3 . . . . . . . . . . . . . . . . . . 5 6 7 8 Distributions: a Cash . b Stock . c Property Other decreases (itemize): . . . . . . . . . Add lines 5 and 6 . . . . . . Balance at end of year (line 4 less line 7) Form 1120 (2015) 1120 U.S. Corporation Income Tax Return Form Department of the Treasury Internal Revenue Service A Check if: 1a Consolidated return (attach Form 851) . b Lifeonlife consolidated return . . . 2 Personal holding co. (attach Sch. PH) . . Income Deductions (See instructions for limitations on deductions.) B Employer identification number Kailua Surf & Swim, Inc. TYPE OR PRINT 65 1234567 C Date incorporated Number, street, and room or suite no. If a P.O. box, see instructions. 5432 Lunalilo Road, Kahala, Hawaii 96816. December 31, 2011 D Total assets (see instructions) City or town, state, or province, country, and ZIP or foreign postal code $ . E Check if: (1) (2) Initial return (3) Final return . . . . . . . . . . . . 1a 2 3 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1b . . . . 5 6 7 Interest . . Gross rents . Gross royalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 9 10 Capital gain net income (attach Schedule D (Form 1120)) . . . . Net gain or (loss) from Form 4797, Part II, line 17 (attach Form 4797) Other income (see instructionsattach statement) . . . . . . . . . . . . . . . 11 12 13 Total income. Add lines 3 through 10 . . . . . . . . Compensation of officers (see instructionsattach Form 1125-E) . . . . . . Salaries and wages (less employment credits) Repairs and maintenance . . . . . . Bad debts . . . . . . . . . . . Rents . . . . . . . . . . . . . . . . . . . . 14 15 16 . . . . . . . . . . . . . . . . . . . . . . . . 17 18 19 Taxes and licenses . . Interest . . . . . Charitable contributions . . . . . . . . . . . . . . . . . . . . . . . . . Gross receipts or sales . . . . . 8,198,561 (4) Name change Returns and allowances . . . . . Balance. Subtract line 1b from line 1a Cost of goods sold (attach Form 1125-A) Gross profit. Subtract line 2 from line 1c Dividends (Schedule C, line 19) . . Address change . . . . $9,500,000 237,500 . . . . . . . . . . . . . . . . . . . . 1c 2 3 4 $9,262,500 4,275,000 $4,987,500 11,400 . . . . . . . . . . . . . . . . . . . . . 5 6 7 0 0 0 . . . . . . . . . . . . . . . . . . . . . . . . 8 9 10 122,000 $2,115,218 0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 12 13 7,240,868 617,500 380,000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 15 16 19,760 41,591 0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 18 19 130,625 199,500 28,500 20 21 22 Depreciation from Form 4562 not claimed on Form 1125-A or elsewhere on return (attach Form 4562) . Depletion . . . . . . . . . . . . . . . . . . . . . . . . . . . . Advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 21 22 231,333 0 45,600 23 24 25 Pension, profit-sharing, etc., plans . . . . . . . . Employee benefit programs . . . . . . . . . . Domestic production activities deduction (attach Form 8903) . . . . 23 24 25 0 0 0 26 27 28 Other deductions (attach statement) . . . . . . . . . . . . . . . . . . . . . Total deductions. Add lines 12 through 26 . . . . . . . . . . . . . . . . . . . Taxable income before net operating loss deduction and special deductions. Subtract line 27 from line 11. 26 27 28 0 1,694,409 5,546,459 29a b Net operating loss deduction (see instructions) . Special deductions (Schedule C, line 20) . . . b c Tax, Refundable Credits, and Payments 2015 15 , 20 Name 4 Schedule M-3 attached 1a Dec 31 , 2015, ending Information about Form 1120 and its separate instructions is at www.irs.gov/form1120. 3 Personal service corp. (see instructions) . Jan 1 For calendar year 2015 or tax year beginning OMB No. 1545-0123 c 30 31 32 33 34 35 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Add lines 29a and 29b . . . . . . . . . . . . . Taxable income. Subtract line 29c from line 28 (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29a 29b 0 0 . . . . . . . . . . . . 29c 30 0 5,546,459 Total tax (Schedule J, Part I, line 11) . . . . . . . . . . . . . . . . Total payments and refundable credits (Schedule J, Part II, line 21) . . . . . . . Estimated tax penalty (see instructions). Check if Form 2220 is attached . . . . . Amount owed. If line 32 is smaller than the total of lines 31 and 33, enter amount owed . . . . . . . . . . . . . . . . 31 32 33 34 960,000 130,625 4455834 17,693 Overpayment. If line 32 is larger than the total of lines 31 and 33, enter amount overpaid Enter amount from line 35 you want: Credited to 2016 estimated tax . . . . . Refunded . . . . . . 35 36 Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge. Date Signature of officer Paid Preparer Use Only Print/Type preparer's name Preparer's signature Sign Here . . . May the IRS discuss this return with the preparer shown below (see instructions)? Yes No Title Date Check if self-employed Firm's name Firm's EIN Firm's address Phone no. For Paperwork Reduction Act Notice, see separate instructions. Cat. No. 11450Q PTIN Form 1120 (2015) Page 2 Form 1120 (2015) Schedule C Dividends and Special Deductions (see instructions) (a) Dividends received (b) % (c) Special deductions (a) (b) 1 Dividends from less-than-20%-owned domestic corporations (other than debt-financed stock) . . . . . . . . . . . . . . . . . . . . . . . . 11,400 70 0 2 Dividends from 20%-or-more-owned domestic corporations (other than debt-financed stock) . . . . . . . . . . . . . . . . . . . . . . . . 0 80 0 see instructions 3 Dividends on debt-financed stock of domestic and foreign corporations . . . . . 0 4 Dividends on certain preferred stock of less-than-20%-owned public utilities . . . 0 42 0 5 Dividends on certain preferred stock of 20%-or-more-owned public utilities . . . . 0 48 0 6 Dividends from less-than-20%-owned foreign corporations and certain FSCs . . . 0 70 0 7 Dividends from 20%-or-more-owned foreign corporations and certain FSCs . . . 0 80 0 8 Dividends from wholly owned foreign subsidiaries 0 100 0 9 Total. Add lines 1 through 8. See instructions for limitation 10 . . . . . . . . . . . . . . . . . . . 0 0 Dividends from domestic corporations received by a small business investment company operating under the Small Business Investment Act of 1958 . . . . . 0 100 0 11 Dividends from affiliated group members . . . . . . . . . . . . . . 0 100 0 12 Dividends from certain FSCs . . . . . . . . . . . . . 0 100 0 13 Dividends from foreign corporations not included on lines 3, 6, 7, 8, 11, or 12 . . . 0 14 Income from controlled foreign corporations under subpart F (attach Form(s) 5471) . 0 15 Foreign dividend gross-up . . . . . . . 0 16 IC-DISC and former DISC dividends not included on lines 1, 2, or 3 . . . . . . 0 17 Other dividends . . . . . . 0 18 Deduction for dividends paid on certain preferred stock of public utilities . . . . 19 Total dividends. Add lines 1 through 17. Enter here and on page 1, line 4 . . . 20 Total special deductions. Add lines 9, 10, 11, 12, and 18. Enter here and on page 1, line 29b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 11,400 . . . . . . 0 Form 1120 (2015) Page 3 Form 1120 (2015) Schedule J Tax Computation and Payment (see instructions) Part I-Tax Computation 1 2 3 Check if the corporation is a member of a controlled group (attach Schedule O (Form 1120)) . Income tax. Check if a qualified personal service corporation (see instructions) . . . . Alternative minimum tax (attach Form 4626) . . . . . . . . . . . . . . . . . . . . . . . . . 4 5a b Add lines 2 and 3 . . . . . . . . Foreign tax credit (attach Form 1118) . . Credit from Form 8834 (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . General business credit (attach Form 3800) . . . Credit for prior year minimum tax (attach Form 8827) Bond credits from Form 8912 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 7 Total credits. Add lines 5a through 5e Subtract line 6 from line 4 . . . . . . . . . . . . . . . . . . . . . . . . 8 9a Personal holding company tax (attach Schedule PH (Form 1120)) . Recapture of investment credit (attach Form 4255) . . . . . . . . . . . . . . . . b Recapture of low-income housing credit (attach Form 8611) . . . . . 9b 0 c Interest due under the look-back methodcompleted long-term contracts (attach Form 8697) . . . . . . . . . . . . . . . . . . . . . . 9c 0 d Interest due under the look-back methodincome forecast method 8866) . . . . . . . . . . . . . . . . . . . Alternative tax on qualifying shipping activities (attach Form 8902) . Other (see instructionsattach statement) . . . . . . . . 9d 9e 9f 0 0 0 e f 10 11 . . . . . . . . Total. Add lines 9a through 9f . . . . . . . . . . . . Total tax. Add lines 7, 8, and 10. Enter here and on page 1, line 31 . (attach . . . . . . . . . 5a 5b Form . . . . . . . . . 6 7 0 17,693 . 8 0 17,693 0 0 5c 5d 5e . . 17,693 0 3 4 . . . . . . . . . 2 . . . c d e . . . 0 0 0 . . . . . . . . . . . . 9a . . . . 0 . . . . . . . . . . . . . . . . . . . . . . . . 10 11 0 17,693 Part II-Payments and Refundable Credits 12 13 2014 overpayment credited to 2015 2015 estimated tax payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 13 0 0 14 15 16 2015 refund applied for on Form 4466 . Combine lines 12, 13, and 14 . . . Tax deposited with Form 7004 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 ( 15 16 0 0 0 17 18 Withholding (see instructions) . . . . Total payments. Add lines 15, 16, and 17 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 18 0 0 19 Refundable credits from: Form 2439 . . . . . . . . . . . . . . . . . . 20 Form 4136 . . . . . . . . . . Form 8827, line 8c . . . . . . . Other (attach statementsee instructions). Total credits. Add lines 19a through 19d . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19a 19b 19c 19d . . . Total payments and credits. Add lines 18 and 20. Enter here and on page 1, line 32 . 20 21 0 21 a b c d Schedule K . . . . Other Information (see instructions) 1 Check accounting method: a 2 a b See the instructions and enter the: Business activity code no. Business activity c Product or service Cash b Accrual c . Is the corporation a subsidiary in an affiliated group or a parent-subsidiary controlled group? If \"Yes,\" enter name and EIN of the parent corporation 4 At the end of the tax year: b 0 0 0 0 . . . . . . . . . . 0 Other (specify) 3 a . ) Yes . . . . . . . . . No . Did any foreign or domestic corporation, partnership (including any entity treated as a partnership), trust, or tax-exempt organization own directly 20% or more, or own, directly or indirectly, 50% or more of the total voting power of all classes of the corporation's stock entitled to vote? If "Yes," complete Part I of Schedule G (Form 1120) (attach Schedule G) . . . . . . Did any individual or estate own directly 20% or more, or own, directly or indirectly, 50% or more of the total voting power of all classes of the corporation's stock entitled to vote? If "Yes," complete Part II of Schedule G (Form 1120) (attach Schedule G) . Form 1120 (2015) Page 4 Form 1120 (2015) Schedule K Other Information continued (see instructions) Yes 5 No At the end of the tax year, did the corporation: a Own directly 20% or more, or own, directly or indirectly, 50% or more of the total voting power of all classes of stock entitled to vote of any foreign or domestic corporation not included on Form 851, Affiliations Schedule? For rules of constructive ownership, see instructions. If \"Yes,\" complete (i) through (iv) below. (i) Name of Corporation (ii) Employer Identification Number (if any) (iv) Percentage Owned in Voting Stock (iii) Country of Incorporation b Own directly an interest of 20% or more, or own, directly or indirectly, an interest of 50% or more in any foreign or domestic partnership (including an entity treated as a partnership) or in the beneficial interest of a trust? For rules of constructive ownership, see instructions. If \"Yes,\" complete (i) through (iv) below. (i) Name of Entity 6 (ii) Employer Identification Number (if any) (iv) Maximum Percentage Owned in Profit, Loss, or Capital (iii) Country of Organization During this tax year, did the corporation pay dividends (other than stock dividends and distributions in exchange for stock) in excess of the corporation's current and accumulated earnings and profits? (See sections 301 and 316.) . . . . . . . If "Yes," file Form 5452, Corporate Report of Nondividend Distributions. If this is a consolidated return, answer here for the parent corporation and on Form 851 for each subsidiary. 7 At any time during the tax year, did one foreign person own, directly or indirectly, at least 25% of (a) the total voting power of all classes of the corporation's stock entitled to vote or (b) the total value of all classes of the corporation's stock? . . . . For rules of attribution, see section 318. If \"Yes,\" enter: (i) Percentage owned and (ii) Owner's country 8 (c) The corporation may have to file Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business. Enter the number of Forms 5472 attached Check this box if the corporation issued publicly offered debt instruments with original issue discount . . . . . . 9 10 If checked, the corporation may have to file Form 8281, Information Return for Publicly Offered Original Issue Discount Instruments. Enter the amount of tax-exempt interest received or accrued during the tax year $ Enter the number of shareholders at the end of the tax year (if 100 or fewer) 11 If the corporation has an NOL for the tax year and is electing to forego the carryback period, check here 12 If the corporation is filing a consolidated return, the statement required by Regulations section 1.1502-21(b)(3) must be attached or the election will not be valid. Enter the available NOL carryover from prior tax years (do not reduce it by any deduction on line 29a.) $ 13 . . . . . Are the corporation's total receipts (page 1, line 1a, plus lines 4 through 10) for the tax year and its total assets at the end of the tax year less than $250,000? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . If \"Yes,\" the corporation is not required to complete Schedules L, M-1, and M-2. Instead, enter the total amount of cash distributions and the book value of property distributions (other than cash) made during the tax year $ 14 15a b Is the corporation required to file Schedule UTP (Form 1120), Uncertain Tax Position Statement (see instructions)? If \"Yes,\" complete and attach Schedule UTP. Did the corporation make any payments in 2015 that would require it to file Form(s) 1099? . . . . . . . If \"Yes,\" did or will the corporation file required Forms 1099? . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 During this tax year, did the corporation have an 80% or more change in ownership, including a change due to redemption of its own stock? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 During or subsequent to this tax year, but before the filing of this return, did the corporation dispose of more than 65% (by value) of its assets in a taxable, non-taxable, or tax deferred transaction? . . . . . . . . . . . . . . . . . . 18 Did the corporation receive assets in a section 351 transfer in which any of the transferred assets had a fair market basis or fair market value of more than $1 million? . . . . . . . . . . . . . . . . . . . . . . . . . . . Form 1120 (2015) Page 5 Form 1120 (2015) Schedule L Balance Sheets per Books Beginning of tax year (a) Assets 1 Cash 2a b 3 4 5 6 7 8 9 10a b 11a b 12 13a b 14 15 . . . Trade notes and accounts receivable . Less allowance for bad debts . . . Inventories . . . . . . . . . U.S. government obligations . . . Tax-exempt securities (see instructions) Other current assets (attach statement) Loans to shareholders . . . . . Mortgage and real estate loans . . . Other investments (attach statement) . Buildings and other depreciable assets Less accumulated depreciation . . . Depletable assets . . . . . . . Less accumulated depletion . . . . Land (net of any amortization) . . . Intangible assets (amortizable only) . Less accumulated amortization . . . Other assets (attach statement) . . . Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . End of tax year (b) (c) (d) 243,116 ( 441,180 $22,059 ) $177,823 513,000 25,650 ) 419,121 ( 2,375,000 487,350 3,325,000 32,000 10,220 0 0 265,000 ( 2,610,000 305,000 ) ( 0) ( 0 0) 32,000 8,721 0 0 110,000 4,290,000 472,333 ) 2,305,000 ( 0 ( 300,000 0) 0 ( 0) 3,817,667 300,000 0 5,949,457 8,198,561 300,000 610,000 0 0 2,000,000 22,800 270,000 488,000 0 0 2,300,000 49,755 Liabilities and Shareholders' Equity 16 17 18 19 20 21 22 23 24 25 26 27 28 Accounts payable . . . . . . . . . Mortgages, notes, bonds payable in less than 1 year Other current liabilities (attach statement) . . Loans from shareholders . . . . . . . Mortgages, notes, bonds payable in 1 year or more Other liabilities (attach statement) . . . . Capital stock: a Preferred stock . . . . b Common stock . . . . Additional paid-in capital . . . . . . . Retained earningsAppropriated (attach statement) Retained earningsUnappropriated . . . Adjustments to shareholders' equity (attach statement) Less cost of treasury stock . . . . . . Total liabilities and shareholders' equity . . Schedule M-1 0 900,000 0 900,000 900,000 0 0 2,000,000 0 0) 5,812,800 ( ( Reconciliation of Income (Loss) per Books With Income per Return 900,000 0 0 4,020,218 0 0) 8,027,973 Note: The corporation may be required to file Schedule M-3 (see instructions). 1 Net income (loss) per books . . . . . . 2,115,218 2 Federal income tax per books . . . . . 3 Excess of capital losses over capital gains 1,105,123 122,000 4 Income subject to tax not recorded on books this year (itemize): . a b c 6 4 8 Deductions on this return not charged against book income this year (itemize): 0 a Depreciation . . $ 0 b Charitable contributions $ 9 10 Add lines 7 and 8 . . . . . . Income (page 1, line 28)line 6 less line 9 Expenses recorded on books this year not deducted on this return (itemize): Depreciation . . . . $ Charitable contributions . $ Travel and entertainment . $ Add lines 1 through 5 . Schedule M-2 1 2 3 Income recorded on books this year not included on this return (itemize): 0 Tax-exempt interest $ 0 0 5 7 . . 0 0 0 . . . . . Analysis of Unappropriated Retained Earnings per Books (Line 25, Schedule L) Balance at beginning of year Net income (loss) per books . Other increases (itemize): Add lines 1, 2, and 3 . . . . . . . . . . . . . . . . . . 2,000,000 2,115,218 4,115,218 5 6 7 8 Distributions: a Cash . b Stock . c Property Other decreases (itemize): . . . . . . . . . Add lines 5 and 6 . . . . . . Balance at end of year (line 4 less line 7) 0 0 0 0 0 2,115,218 Form 1120 (2015) 1120 U.S. Corporation Income Tax Return Form Department of the Treasury Internal Revenue Service A Check if: 1a Consolidated return (attach Form 851) . b Lifeonlife consolidated return . . . 2 Personal holding co. (attach Sch. PH) . . Income Deductions (See instructions for limitations on deductions.) B Employer identification number Kailua Surf & Swim, Inc. TYPE OR PRINT 65 1234567 C Date incorporated Number, street, and room or suite no. If a P.O. box, see instructions. 5432 Lunalilo Road, Kahala, Hawaii 96816. December 31, 2011 D Total assets (see instructions) City or town, state, or province, country, and ZIP or foreign postal code $ . E Check if: (1) (2) Initial return (3) Final return . . . . . . . . . . . . 1a 2 3 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1b . . . . 5 6 7 Interest . . Gross rents . Gross royalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 9 10 Capital gain net income (attach Schedule D (Form 1120)) . . . . Net gain or (loss) from Form 4797, Part II, line 17 (attach Form 4797) Other income (see instructionsattach statement) . . . . . . . . . . . . . . . 11 12 13 Total income. Add lines 3 through 10 . . . . . . . . Compensation of officers (see instructionsattach Form 1125-E) . . . . . . Salaries and wages (less employment credits) Repairs and maintenance . . . . . . Bad debts . . . . . . . . . . . Rents . . . . . . . . . . . . . . . . . . . . 14 15 16 . . . . . . . . . . . . . . . . . . . . . . . . 17 18 19 Taxes and licenses . . Interest . . . . . Charitable contributions . . . . . . . . . . . . . . . . . . . . . . . . . Gross receipts or sales . . . . . 8,198,561 (4) Name change Returns and allowances . . . . . Balance. Subtract line 1b from line 1a Cost of goods sold (attach Form 1125-A) Gross profit. Subtract line 2 from line 1c Dividends (Schedule C, line 19) . . Address change . . . . $9,500,000 237,500 . . . . . . . . . . . . . . . . . . . . 1c 2 3 4 $9,262,500 4,275,000 $4,987,500 11,400 . . . . . . . . . . . . . . . . . . . . . 5 6 7 0 0 0 . . . . . . . . . . . . . . . . . . . . . . . . 8 9 10 122,000 $2,115,218 0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 12 13 7,240,868 617,500 380,000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 15 16 19,760 41,591 0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 18 19 130,625 199,500 28,500 20 21 22 Depreciation from Form 4562 not claimed on Form 1125-A or elsewhere on return (attach Form 4562) . Depletion . . . . . . . . . . . . . . . . . . . . . . . . . . . . Advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 21 22 231,333 0 45,600 23 24 25 Pension, profit-sharing, etc., plans . . . . . . . . Employee benefit programs . . . . . . . . . . Domestic production activities deduction (attach Form 8903) . . . . 23 24 25 0 0 0 26 27 28 Other deductions (attach statement) . . . . . . . . . . . . . . . . . . . . . Total deductions. Add lines 12 through 26 . . . . . . . . . . . . . . . . . . . Taxable income before net operating loss deduction and special deductions. Subtract line 27 from line 11. 26 27 28 0 1,694,409 5,546,459 29a b Net operating loss deduction (see instructions) . Special deductions (Schedule C, line 20) . . . b c Tax, Refundable Credits, and Payments 2015 15 , 20 Name 4 Schedule M-3 attached 1a Dec 31 , 2015, ending Information about Form 1120 and its separate instructions is at www.irs.gov/form1120. 3 Personal service corp. (see instructions) . Jan 1 For calendar year 2015 or tax year beginning OMB No. 1545-0123 c 30 31 32 33 34 35 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Add lines 29a and 29b . . . . . . . . . . . . . Taxable income. Subtract line 29c from line 28 (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29a 29b 0 0 . . . . . . . . . . . . 29c 30 0 5,546,459 Total tax (Schedule J, Part I, line 11) . . . . . . . . . . . . . . . . Total payments and refundable credits (Schedule J, Part II, line 21) . . . . . . . Estimated tax penalty (see instructions). Check if Form 2220 is attached . . . . . Amount owed. If line 32 is smaller than the total of lines 31 and 33, enter amount owed . . . . . . . . . . . . . . . . 31 32 33 34 17,693 0 4455834 17,693 Overpayment. If line 32 is larger than the total of lines 31 and 33, enter amount overpaid Enter amount from line 35 you want: Credited to 2016 estimated tax . . . . . Refunded . . . . . . 35 36 Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge. Date Signature of officer Paid Preparer Use Only Print/Type preparer's name Preparer's signature Sign Here . . . May the IRS discuss this return with the preparer shown below (see instructions)? Yes No Title Date Check if self-employed Firm's name Firm's EIN Firm's address Phone no. For Paperwork Reduction Act Notice, see separate instructions. Cat. No. 11450Q PTIN Form 1120 (2015) Page 2 Form 1120 (2015) Schedule C Dividends and Special Deductions (see instructions) (a) Dividends received (b) % (c) Special deductions (a) (b) 1 Dividends from less-than-20%-owned domestic corporations (other than debt-financed stock) . . . . . . . . . . . . . . . . . . . . . . . . 11,400 70 0 2 Dividends from 20%-or-more-owned domestic corporations (other than debt-financed stock) . . . . . . . . . . . . . . . . . . . . . . . . 0 80 0 see instructions 3 Dividends on debt-financed stock of domestic and foreign corporations . . . . . 0 4 Dividends on certain preferred stock of less-than-20%-owned public utilities . . . 0 42 0 5 Dividends on certain preferred stock of 20%-or-more-owned public utilities . . . . 0 48 0 6 Dividends from less-than-20%-owned foreign corporations and certain FSCs . . . 0 70 0 7 Dividends from 20%-or-more-owned foreign corporations and certain FSCs . . . 0 80 0 8 Dividends from wholly owned foreign subsidiaries 0 100 0 9 Total. Add lines 1 through 8. See instructions for limitation 10 . . . . . . . . . . . . . . . . . . . 0 0 Dividends from domestic corporations received by a small business investment company operating under the Small Business Investment Act of 1958 . . . . . 0 100 0 11 Dividends from affiliated group members . . . . . . . . . . . . . . 0 100 0 12 Dividends from certain FSCs . . . . . . . . . . . . . 0 100 0 13 Dividends from foreign corporations not included on lines 3, 6, 7, 8, 11, or 12 . . . 0 14 Income from controlled foreign corporations under subpart F (attach Form(s) 5471) . 0 15 Foreign dividend gross-up . . . . . . . 0 16 IC-DISC and former DISC dividends not included on lines 1, 2, or 3 . . . . . . 0 17 Other dividends . . . . . . 0 18 Deduction for dividends paid on certain preferred stock of public utilities . . . . 19 Total dividends. Add lines 1 through 17. Enter here and on page 1, line 4 . . . 20 Total special deductions. Add lines 9, 10, 11, 12, and 18. Enter here and on page 1, line 29b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 11,400 . . . . . . 0 Form 1120 (2015) Page 3 Form 1120 (2015) Schedule J Tax Computation and Payment (see instructions) Part I-Tax Computation 1 2 3 Check if the corporation is a member of a controlled group (attach Schedule O (Form 1120)) . Income tax. Check if a qualified personal service corporation (see instructions) . . . . Alternative minimum tax (attach Form 4626) . . . . . . . . . . . . . . . . . . . . . . . . . 4 5a b Add lines 2 and 3 . . . . . . . . Foreign tax credit (attach Form 1118) . . Credit from Form 8834 (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . General business credit (attach Form 3800) . . . Credit for prior year minimum tax (attach Form 8827) Bond credits from Form 8912 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 7 Total credits. Add lines 5a through 5e Subtract line 6 from line 4 . . . . . . . . . . . . . . . . . . . . . . . . 8 9a Personal holding company tax (attach Schedule PH (Form 1120)) . Recapture of investment credit (attach Form 4255) . . . . . . . . . . . . . . . . b Recapture of low-income housing credit (attach Form 8611) . . . . . 9b 0 c Interest due under the look-back methodcompleted long-term contracts (attach Form 8697) . . . . . . . . . . . . . . . . . . . . . . 9c 0 d Interest due under the look-back methodincome forecast method 8866) . . . . . . . . . . . . . . . . . . . Alternative tax on qualifying shipping activities (attach Form 8902) . Other (see instructionsattach statement) . . . . . . . . 9d 9e 9f 0 0 0 e f 10 11 . . . . . . . . Total. Add lines 9a through 9f . . . . . . . . . . . . Total tax. Add lines 7, 8, and 10. Enter here and on page 1, line 31 . (attach . . . . . . . . . 5a 5b Form . . . . . . . . . 6 7 0 17,693 . 8 0 17,693 0 0 5c 5d 5e . . 17,693 0 3 4 . . . . . . . . . 2 . . . c d e . . . 0 0 0 . . . . . . . . . . . . 9a . . . . 0 . . . . . . . . . . . . . . . . . . . . . . . . 10 11 0 17,693 Part II-Payments and Refundable Credits 12 13 2014 overpayment credited to 2015 2015 estimated tax payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 13 0 0 14 15 16 2015 refund applied for on Form 4466 . Combine lines 12, 13, and 14 . . . Tax deposited with Form 7004 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 ( 15 16 0 0 0 17 18 Withholding (see instructions) . . . . Total payments. Add lines 15, 16, and 17 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 18 0 0 19 Refundable credits from: Form 2439 . . . . . . . . . . . . . . . . . . 20 Form 4136 . . . . . . . . . . Form 8827, line 8c . . . . . . . Other (attach statementsee instructions). Total credits. Add lines 19a through 19d . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19a 19b 19c 19d . . . Total payments and credits. Add lines 18 and 20. Enter here and on page 1, line 32 . 20 21 0 21 a b c d Schedule K . . . . Other Information (see instructions) 1 Check accounting method: a 2 a b See the instructions and enter the: Business activity code no. Business activity c Product or service Cash b Accrual c . Is the corporation a subsidiary in an affiliated group or a parent-subsidiary controlled group? If \"Yes,\" enter name and EIN of the parent corporation 4 At the end of the tax year: b 0 0 0 0 . . . . . . . . . . 0 Other (specify) 3 a . ) Yes . . . . . . . . . No . Did any foreign or domestic corporation, partnership (including any entity treated as a partnership), trust, or tax-exempt organization own directly 20% or more, or own, directly or indirectly, 50% or more of the total voting power of all classes of the corporation's stock entitled to vote? If "Yes," complete Part I of Schedule G (Form 1120) (attach Schedule G) . . . . . . Did any individual or estate own directly 20% or more, or own, directly or indirectly, 50% or more of the total voting power of all classes of the corporation's stock entitled to vote? If "Yes," complete Part II of Schedule G (Form 1120) (attach Schedule G) . Form 1120 (2015) Page 4 Form 1120 (2015) Schedule K Other Information continued (see instructions) Yes 5 No At the end of the tax year, did the corporation: a Own directly 20% or more, or own, directly or indirectly, 50% or more of the total voting power of all classes of stock entitled to vote of any foreign or domestic corporation not included on Form 851, Affiliations Schedule? For rules of constructive ownership, see instructions. If \"Yes,\" complete (i) through (iv) below. (i) Name of Corporation (ii) Employer Identification Number (if any) (iv) Percentage Owned in Voting Stock (iii) Country of Incorporation b Own directly an interest of 20% or more, or own, directly or indirectly, an interest of 50% or more in any foreign or domestic partnership (including an entity treated as a partnership) or in the beneficial interest of a trust? For rules of constructive ownership, see instructions. If \"Yes,\" complete (i) through (iv) below. (i) Name of Entity 6 (ii) Employer Identification Number (if any) (iv) Maximum Percentage Owned in Profit, Loss, or Capital (iii) Country of Organization During this tax year, did the corporation pay dividends (other than stock dividends and distributions in exchange for stock) in excess of the corporation's current and accumulated earnings and profits? (See sections 301 and 316.) . . . . . . . If "Yes," file Form 5452, Corporate Report of Nondividend Distributions. If this is a consolidated return, answer here for the parent corporation and on Form 851 for each subsidiary. 7 At any time during the tax year, did one foreign person own, directly or indirectly, at least 25% of (a) the total voting power of all classes of the corporation's stock entitled to vote or (b) the total value of all classes of the corporation's stock? . . . . For rules of attribution, see section 318. If \"Yes,\" enter: (i) Percentage owned and (ii) Owner's country 8 (c) The corporation may have to file Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business. Enter the number of Forms 5472 attached Check this box if the corporation issued publicly offered debt instruments with original issue discount . . . . . . 9 10 If checked, the corporation may have to file Form 8281, Information Return for Publicly Offered Original Issue Discount Instruments. Enter the amount of tax-exempt interest received or accrued during the tax year $ Enter the number of shareholders at the end of the tax year (if 100 or fewer) 11 If the corporation has an NOL for the tax year and is electing to forego the carryback period, check here 12 If the corporation is filing a consolidated return, the statement required by Regulations section 1.1502-21(b)(3) must be attached or the election will not be valid. Enter the available NOL carryover from prior tax years (do not reduce it by any deduction on line 29a.) $ 13 . . . . . Are the corporation's total receipts (page 1, line 1a, plus lines 4 through 10) for the tax year and its total assets at the end of the tax year less than $250,000? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . If \"Yes,\" the corporation is not required to complete Schedules L, M-1, and M-2. Instead, enter the total amount of cash distributions and the book value of property distributions (other than cash) made during the tax year $ 14 15a b Is the corporation required to file Schedule UTP (Form 1120), Uncertain Tax Position Statement (see instructions)? If \"Yes,\" complete and attach Schedule UTP. Did the corporation make any payments in 2015 that would require it to file Form(s) 1099? . . . . . . . If \"Yes,\" did or will the corporation file required Forms 1099? . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 During this tax year, did the corporation have an 80% or more change in ownership, including a change due to redemption of its own stock? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 During or subsequent to this tax year, but before the filing of this return, did the corporation dispose of more than 65% (by value) of its assets in a taxable, non-taxable, or tax deferred transaction? . . . . . . . . . . . . . . . . . . 18 Did the corporation receive assets in a section 351 transfer in which any of the transferred assets had a fair market basis or fair market value of more than $1 million? . . . . . . . . . . . . . . . . . . . . . . . . . . . Form 1120 (2015) Page 5 Form 1120 (2015) Schedule L Balance Sheets per Books Beginning of tax year (a) Assets 1 Cash 2a b 3 4 5 6 7 8 9 10a b 11a b 12 13a b 14 15 . . . Trade notes and accounts receivable . Less allowance for bad debts . . . Inventories . . . . . . . . . U.S. government obligations . . . Tax-exempt securities (see instructions) Other current assets (attach statement) Loans to shareholders . . . . . Mortgage and real estate loans . . . Other investments (attach statement) . Buildings and other depreciable assets Less accumulated depreciation . . . Depletable assets . . . . . . . Less accumulated depletion . . . . Land (net of any amortization) . . . Intangible assets (amortizable only) . Less accumulated amortization . . . Other assets (attach statement) . . . Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . End of tax year (b) (c) (d) 243,116 ( 441,180 $22,059 ) $177,823 513,000 25,650 ) 419,121 ( 2,375,000 487,350 3,325,000 32,000 10,220 0 0 265,000 ( 2,610,000 305,000 ) ( 0) ( 0 0) 32,000 8,721 0 0 110,000 4,290,000 472,333 ) 2,305,000 ( 0 ( 300,000 0) 0 ( 0) 3,817,667 300,000 0 5,949,457 8,198,561 300,000 610,000 0 0 2,000,000 22,800 270,000 488,000 0 0 2,300,000 49,755 Liabilities and Shareholders' Equity 16 17 18 19 20 21 22 23 24 25 26 27 28 Accounts payable . . . . . . . . . Mortgages, notes, bonds payable in less than 1 year Other current liabilities (attach statement) . . Loans from shareholders . . . . . . . Mortgages, notes, bonds payable in 1 year or more Other liabilities (attach statement) . . . . Capital stock: a Preferred stock . . . . b Common stock . . . . Additional paid-in capital . . . . . . . Retained earningsAppropriated (attach statement) Retained earningsUnappropriated . . . Adjustments to shareholders' equity (attach statement) Less cost of treasury stock . . . . . . Total liabilities and shareholders' equity . . Schedule M-1 0 900,000 0 900,000 900,000 0 0 2,000,000 0 0) 5,812,800 ( ( Reconciliation of Income (Loss) per Books With Income per Return 900,000 0 0 4,020,218 0 0) 8,027,973 Note: The corporation may be required to file Schedule M-3 (see instructions). 1 Net income (loss) per books . . . . . . 2,115,218 2 Federal income tax per books . . . . . 3 Excess of capital losses over capital gains 1,105,123 122,000 4 Income subject to tax not recorded on books this year (itemize): . a b c 6 4 8 Deductions on this return not charged against book income this year (itemize): 0 a Depreciation . . $ 0 b Charitable contributions $ 9 10 Add lines 7 and 8 . . . . . . Income (page 1, line 28)line 6 less line 9 Expenses recorded on books this year not deducted on this return (itemize): Depreciation . . . . $ Charitable contributions . $ Travel and entertainment . $ Add lines 1 through 5 . Schedule M-2 1 2 3 Income recorded on books this year not included on this return (itemize): 0 Tax-exempt interest $ 0 0 5 7 . . 0 0 0 . . . . . Analysis of Unappropriated Retained Earnings per Books (Line 25, Schedule L) Balance at beginning of year Net income (loss) per books . Other increases (itemize): Add lines 1, 2, and 3 . . . . . . . . . . . . . . . . . . 2,000,000 2,115,218 4,115,218 5 6 7 8 Distributions: a Cash . b Stock . c Property Other decreases (itemize): . . . . . . . . . Add lines 5 and 6 . . . . . . Balance at end of year (line 4 less line 7) 0 0 0 0 0 2,115,218 Form 1120 (2015) 1120 U.S. Corporation Income Tax Return Form Department of the Treasury Internal Revenue Service A Check if: 1a Consolidated return (attach Form 851) . b Life