Furry Critters, Inc.

Book to Tax Reconciliation $($ Schedule M$-1)$

Worksheet

Year Ended December $31,2023$

$\backslash$table$[[,\backslash$table$[[$Per Financial$],[$Statements$]],\backslash$table$[[$Book$-$to$-$Tax$],[$Differences$]],$Per Tax Return$],[$Revenue$],[$Gross sales,$$6,330,500,,],[$Sales returns and allowances,$($$$175,000),,],[$Net sales,$6,155,500,,],[$Cost of goods sold,$(2,925,000),,],[$Gross Profit,$3,230,500,,],[\backslash$table$[[$Dividends $-$ Received from stock investments$],[$in less than $20\%$ owned U$.$S$.$ Corporations$]],22,000,,],[$Interest income $-$ state$/$municipal bonds,$8,500,(8500),0],[$Interest income $-$ certificates of deposit,$24,000,,],[$Total Income,$3,285,000,,],[$Expenses$],[$Salaries $-$ clerical and sales,$825,000,,],[$Salaries $-$ officers:$],[$Wei Chen,$220,000,,],[$Alexandra Rojas,$220,000,,],[$Taxes $-$ state, local and payroll,$235,000,,],[$Repairs and maintenance:,$45,000,,],[$Utilities$,38,000,,],[$Meals $-$ Business,$75,000,,],[$Entertainment$,60,000,,],[$Interest expense,$128,500,,],[$Insurance $-$ casualty,$18,000,,],[$Advertising$,75,000,,],[$Rental expense,$142,000,,],[$Depreciation$,273,000,,],[$Charitable contributions $-$ cash,$24,000,,],[$Employee benefit programs,$72,000,,],[\backslash$table$[[$Premiums on term life insurance $-$ policies$],[$on lives of Janet Moryton and Kim Wong,$]]],[$Critter World is the designated beneficiary,$28,000,,],[$Miscellaneous $-$ Sales tax penalty paid to Texas,$2,500,,],[$Professiona fees $($accounting services$),30,000,,],[$Total Expenses,$2,511,000,,],[$Net income before Federal income tax,$774,000,,],[$Federal income tax expense,$(162,540),,],[$Net Income per Financial Statements,$$611,460,,],[\backslash$table$[[$Taxable Income per Sch$.$ M$-1,$ Line $10],[$Special deduction $($Dividends Received$)]],,,],[$Taxable Income per Line $30,,,]]$