Fish Corporation GAAP Income Statement For 2019 Calendar Year Income Gross Sales 50,600,000 Sales Returns & Allowances (300,000) Net Sales 50,300,000 Cost of Goods Sold (29,000,000) Gross Profit 21,300,000 Dividends from less-than-20%-owned US corporation 50,000 Interest Income: - MN State Bonds 80,000 - Certificates of Deposit 75,000 Total Income 21,505,000 Operating Expenses Officer Salaries: - Joe Northern 950,000 - Samantha Bass 1,375,000 Other Administrative Salaries 5,500,000 State Income Taxes 400,000 Real Property Taxes 500,000 Repairs 46,000 Bad Debt Expense 200,000 Interest Expense: - Business Loans (Mortgage) 1,048,000 - Loan to Purchase State Bonds 33,000 Advertising 35,000 Business Entertainment 44,000 Depreciation Expense 1,700,000 Charitable Contributions 300,000 Employee Benefit Programs 1,200,000 Premiums on officer's life insurance policies* 32,000 Business Meals 30,000 Total Expenses 13,393,000 Net Income Before Federal Income Taxes 8,112,000 Federal Income Tax Expense 1,786,260 Net Income 6,325,740 * Fish Corporation is designated as the beneficiary on these life insurance policiesFish Corporation Balance Sheet Assets 31-Dec-19 31-Dec-18 Cash 1,800,000 1,600,000 Accounts Receivable 4,800,000 4,200,000 Allowance for Doubtful Accounts (500,000) (400,000) Inventory 12,994,514 9,500,000 Federal Income Tax Receivable 30,771 Certificates of Deposit 7,500,000 7,500,000 State Bonds 2,400,000 2,400,000 Stock Investments 800,000 800,000 Building & Other Assets 49,000,000 49,000,000 Accumulated Depreciation (9,650,000) (7,950,000) Land 3,500,000 3,500,000 Total Assets 72,675,285 70,150,000 Liabilities & Equity 31-Dec-19 31-Dec-18 Accounts Payable 4,105,000 3,984,000 Federal Deferred Tax Liability 366,723 349,692 Mortgages Payable > 1 Year 45,000,000 46,000,000 Common Stock 1,000,000 1,000,000 Retained Earnings (Unappropriated) 22,203,562 18,816,308 Total Liabilities & Equity 72,675,285 70,150,000 GAAP Fixed Asset Details GAAP Life In Service Cost A/D@ 12/31/18 2019 Depr Exp A/D @ 12/31/19 Non-Residential Building 40 7/1/2015 40,000,000 3,500,000 1,000,000 4,500,000 Office Furniture & Fixtures 10 7/1/2015 7,000,000 2,450,000 700,000 3,150,000 Computers 3 7/1/2015 2,000,000 2,000,000 2,000,000 Totals 49,000,000 7,950,000 1,700,000 9,650,0001120 Process Hints Form 1120, Page 1: This page is done on a "tax basis". Numbers posted on page 1 are computed as the GAAP income statement (given) plus or minus the book/tax differences (M-1's). Form 1120, Page 6: Schedule L - This is the GAAP balance sheet (given). Schedule M-1 - These are the book/tax differences you have identified. Schedule M-2 - This is the reconciliation of beginning to ending GAAP retained earnings. Check Your Work: Make sure your balance sheet balances!! The balance sheet is Schedule L discussed above. Line 15 total assets must equal line 28 liabilities & equity as of both the beginning and end of the tax year balance sheets. Make sure your taxable income on page 1 of your Form 1120 reconciles to your taxable income on the bottom of your Schedule M-1. Make sure your unappropriated retained earnings at the bottom of Schedule M-2 reconciles with the unappropriated retained earnings on your Schedule L balance sheet as of the end of the tax year.ACCT 314 Tax Accounting Form 1120 Corporate Tax Return Project Spring 2020 Overview . Your project is to complete the 2019 Corporate Income Tax Return (IRS Form 1 120 and supporting forms/schedules) for Fish Corporation. This project is worth 30 points and is to be completed with your partner using the Intuit Proconnect tax software (same software used on 1040 Tax Return Project). . Project is due as PDF file at the beginning of class on April 23rd. Project Deliverables: (1) Filled-in 2019 IRS tax return forms (30 Points). Students work with partners on this project. All partners generally receive the same score. Only one set of tax return forms is submitted for grading. HINTS & COMMENTS o HINT: Start by solving Sch. M-1, this is key to the corporate income tax return process! ! o Note that although Fish Corporation's total assets are greater than $10 Million, you should prepare Sch. M-1, not Sch. M-3. You will need to override the software to indicate you are doing Sch. M-1, not Sch. M-3. o Input income and deductions into tax return software on a "tax basis". Note that some of the Sch. M-1 differences will automatically "flow" to Sch. M-1 based on your input of the underlying item (c.g. business meal expenses). While other Sch. M-1 differences will need to be manually entered into the appropriate section of the tax software