FOR THOSE WHO HAVE H AND R BLOCK TAX SOFTWARE.COMPLETE THIS CORPORATE TAX RETURN (FEDERAL AND STATE) [Minnesota and Wisonsin]

WILL PAY A LOT OF $$$$$$$ FOR CORRECT ANSWER

INSTRUCTIONS

To: Tax Staff From: William Fairle, Managing Partner Date: December 1, 2016 Re: Go Purple, Corporate Tax Return The Go Purple Corporation is a C-Corporation formed on January 10, 1985, by Ted Anderson and Jill Hanson. Go Purple was originally created to sell unlicensed, NFL -related clothing, like T-shirts that read Cheese-Free Zone, Bridgewater (or Bradford or whoever) for President or My Two Favorite Teams are the Vikings and Whoever is Playing the Packers. Initially focused entirely in Minnesota and on Minnesota teams, they have recently expanded into Wisconsin (selling anti-Viking and anti-Bear merchandise including hot selling shirts that read Mr. Rodgers Neighborhood). They also have expanded into the collegiate market with shirts for most of the teams in the Big Ten, with sales in Minnesota, Wisconsin, Iowa, Michigan and Ohio. Additional information on Go Purple is as follows: The business address is 2684 Lost Lake Road, Duluth, MN 55803. The employer ID # is 41-3286408; the principal business activity code is 448110. Ted and Jill each own one half of the outstanding common stock; no other class of stock is authorized. Ted is president of the company, and Jill is secretary-treasurer. Both are full-time employees of the corporation and each receives a salary of $70,000. Teds Social Security Number is 299-50-2594 and Jills Social Security Number is 400-40-6680. The corporation uses the accrual method of accounting and reports its income on a calendar year basis. The specific charge-off method is used for bad debts for book purposes as well as tax. Inventories are valued using the lower of cost or market method. The company uses straight line depreciation for books, but uses MACRS for tax. During 2015 the corporation distributed a cash dividend of $35,000. Net Income per books (before any income tax accrual) is $234,000. During 2015 Go Purple Corporation made estimated tax payments to the IRS of $61,000. Go Purples Federal Taxes per books are $59,300. Go Purple corporation has nexus in two states, Minnesota and Wisconsin. Its headquarters, executives and administrative staff are in Minnesota. It has a salesperson in Wisconsin with a rented office and some tangible property. Complete the 2015 federal Form 1120 (along with any other necessary forms) for Go Purple, as well as state tax returns for the corporation. Please complete this return on or before November 30.

P AND L ACCOUNTS

GoPurple, Inc.
Selected P & L Information
12/31/2015
Account		Debit	Credit
Gross Sales			$ 1,040,000
Sales Returns and Allowances		$ 50,000
Purchases		$ 506,000
Dividends Rec'd from stock
investments in < 20% owned
U.S. Corporations			$ 60,000
Interest Income
MN Municipal Bonds	9000
CDs	11000		$ 20,000
Officer's Life Insurance Premiums		$ 8,000
Salaries - Officers		$ 140,000
Salaries - clerical and sales		$ 100,000
Taxes (state, local, payroll)		$ 35,000
Repairs		$ 20,000
Interest Expense
Loan to purchase Muni Bonds	4000
Other business loans	10000	$ 14,000
Advertising		$ 8,000
Rent Expense		$ 24,000
Depreciation (Book)		$ 16,000
Other Deductions		$ 21,000

COMPARATIVE BALANCE SHEET

GoPurple, Inc.
Comparative Balance Sheet
Assets		12/31/2014	12/31/2015
Cash		$ 240,000	$ 163,850
CDs		$ 125,000	$ 125,000
A/R		$ 104,200	$ 142,300
Inventories		$ 300,000	$ 356,000
Municipal Bonds		$ 100,000	$ 100,000
Stock Investment		$ 300,000	$ 400,000
Buildings and Other Depreciable Assets		$ 120,000	$ 120,000
Accumulated Depreciation		$ (44,400)	$ (60,400)
Land		$ 10,000	$ 10,000
Other Assets		$ 1,800	$ 2,700
Total Assets		$ 1,256,600	$ 1,359,450
Liabilities and Equity
Accounts Payable		$ 150,000	$ 125,000
Other Current Liabilities		$ 40,150	$ 33,300
Mortgages		$ 105,000	$ 100,000
Capital Stock		$ 250,000	$ 250,000
Retained Earnings		$ 711,450	$ 851,150
Total Liabilities and Equity		$ 1,256,600	$ 1,359,450

STATE APPORTIONMENT INFO

GoPurple, Inc.
State Income Tax Information
	MN	WI	Others	Total
Sales	$ 450,000	$ 325,000	$ 265,000	$ 1,040,000
Payroll	$ 220,000	$ 20,000	$ -	$ 240,000
Fixed Assets	$ 120,000	$ 10,000		$ 130,000
Rent	$ 16,000	$ 8,000		$ 24,000
Inventory	$ 328,000			$ 328,000

FIXED ASSET LISTING

Asset	Date	Purchase	Book Depr	Book	MACRS	MACRS
	Purchased	Price	2014	Method	Life	Accum Depr
Class
Furniture	2/19/2014	$15,000	$ 3,000	5 Year SL	7	2,144
Computer Equip	1/15/2013	$10,000	$ 3,333	4 Year SL	5	5,200
Office Equip	3/26/2012	$20,000	$ 6,667	4 Year SL	5	14,240
Building	3/21/2008	$75,000	$ 3,000	25 Year SL	39	13,063
Land	3/21/2008	$10,000	$ -	N/A	N/A
Totals		$130,000	$16,000