February 15, 2005, SpongeBob Squarepants and Eugene Krabs formed Krusty Krab Corporation to sell fast food as a full service restaurant. Information regarding Krusty Krab Corp. is summarized as follows: - Krusty Krab Corporation is located at 1300 Conch Street, Bikini Bottom, MI 41010. The employer identification number is 11- 2222222. - SpongeBob owns 50% of the common stock and is vice president of the company. Mr. Krabs owns 50% of the common stock and is president of the company. -Both SpongeBob and Mr. Krabs are full-time employees of the company. SpongeBob's Social Security number is 987-65-4321. Mr. Krab's is 123-45-6789. - Krusty Krab Corp is an accrual method, calendar year taxpayer. Inventories are determined using FIFO and the lower of cost or market method. They use the straight-line method of depreciation for book purposes and accelerated depreciation (MACRS) for tax purposes. - During 2022, the corporation distributed cash dividends of $140,000. -

service restaurant, Information regarding Krusty Krab Corp, is summarized as follows: - Krusty Krab Corporation is located at 1300 Conch Street, Bikini Bottom, MI 41010. The employer identification number is 11 2222222. - SpongeBob owns 50% of the common stock and is vice president of the company. Mr. Krabs owns 50% of the common stock and is president of the company. - Both SpongeBob and Mr. Krabs are full-time employees of the company. SpongeBob's Social Security number is 987-65-4321. Mr. Krab's is 123-45-6789. - Krusty Krab Corp is an accrual method, calendar year taxpayer. Inventories are determined using FIFO and the lower of cost or market method. They use the straight-line method of depreciation for book purposes and accelerated depreciation (MACRS) for tax purposes. - During 2022, the corporation distributed cash dividends of $140,000. - Depreciation under MACRS rules would be $45,100 for 2022. (You are not required to file Form 4562 for this assignment) - During 2022, Krusty Krab Corp. made estimated payments of $28,000 each quarter to the IRS. Prepare Form 1120 with all necessary forms for 2022. For Schedule K complete only lines 1 through 5. you do not need to complete Schedule L. Income Statement Income Gross sales \begin{tabular}{r} 2,408,000 \\ (80,000) \\ \hline 2,328,000 \\ (920,000) \\ \hline 1,408,000 \\ 12,000 \end{tabular} Sales returns and allowances Net Sales Cost of goods sold Gross profit Dlvidends received from stock investments in less than 20%-owned US Corps 12,000 Interest income: State bonds Certificates of deposit \begin{tabular}{l} 14,000 \\ 10,000 \\ \hline \end{tabular} Total Income 1,444,00024,000 Expenses Salaries-officers: SpongeBob Squarepants Eugene Krabs Salaries-other Taxes (state, local, and payroli) Repairs and maintenance Interest expense: Business loans Loan to purchase state bonds Advertising Rental expense Depreciation Charitable contributions Employee benefit programs Premiums on term life insurance for officers, the corporation is the beneficiary \begin{tabular}{l} 160,000 \\ 160,000 \\ \hline \end{tabular} Total expenses Net income before taxes Federal income tax expense Net income per books 320,000 290,000 85,000 56,000 \begin{tabular}{rr} 12,000 \\ 8,000 \\ 20,000 \\ 6,000 \\ 68,000 \\ 40,000 \\ 15,000 \\ 24,000 \\ 16,000 \\ \hline \end{tabular}