Heather Corporation owns and operates a clothing manufacturing company. The corporation reported the following property transactions during 2019: 1. Sale of real estate (unimproved) that has been used as an employee parking lot for S210,000 in April. The lot was purchased in 1998 for $120,000. 2 Sale of office furniture used in the business for $23,000 in December. The furniture was purchased in February 2019 for $25,000 $7,000 in tax depreciation has been claimed on the furniture using accelerated depreciation (If straight-line depreciation had been elected, $3,000 in depreciation expense would have been claimed.) 3. Sale of 2,500 shares of Biotech Corporation common stock for $30 per share in October. The shares were purchased in January 2019 for S24 per share and have been held for investment purposes. This sale transaction was reported to Heather on Form 1099-B showing the stock basis was reported to the IRS 4. Sale of an office building for $2,800,000 in May. The building was purchased in 2000 for $3,600,000. Depreciation of $1,950,000 has been claimed on the building. 5. Sale of factory equipment for $425,000 in July. The equipment was purchased in 2014 for $375,000 $240,000 in tax depreciation has been claimed on the machine using accelerated depreciation (If straight-line depreciation had been elected, S195,000 in depreciation expense would have been claimed.) 6. Sale of 4,000 shares of Windstar, Inc., common stock for $10 per share in June. The 4,000 shares were purchased in May 2017, for $25 per share and have been held for investment purposes. This sale transaction was reported to Heather on Form 1099-B showing the stock basis was reported to the IRS 7. Sale of a factory building in March for $4,500,000. The building was purchased in 2016 for $3,250,000. Depreciation of $800,000 has been claimed on the building. 8. Sale of a factory machine for $1,075,000 in August. The machine was purchased in January 2016 for $4,900,000 $1,400,000 in tax depreciation has been claimed on the building using accelerated depreciation. (If straight-line depreciation had been elected, $860,000 in depreciation expense would have been claimed.) Sale of copier machine for $2,000 in November. The copier was purchased in March 2018 for $6,000 and, for tax purposes, was fully depreciated in 2018 using Section 179. (If straight-line depreciation had been elected, $1,500 in depreciation expense would have been claimed.) Heather Corporation also has a $175,000 capital loss carryforward available from 2015. The company reported the following net Section 1231 gains and losses in previous years: 10 000 2016 (5280 000) 2016 for $4,900,000. S1,400,000 in tax depreciation has been claimed on the building using accelerated depreciation. (If straight-line depreciation had been elected, S860,000 in depreciation expense would have been claimed.) 9 Sale of copier machine for $2,000 in November. The copier was purchased in March 2018 for S6,000 and, for tax purposes, was fully depreciated in 2018 using Section 179. (If straight-line depreciation had been elected, $1,500 in depreciation expense would have been claimed.) Heather Corporation also has a $175,000 capital loss carryforward available from 2015. The company reported the following net Section 1231 gains and losses in previous years: 2013 $150,000 2014 ($320,000) 2015 $450,000 2016 ($280,000) 2017 ($270,000) 2018 $220,000 Required: (25.0 points) Using the above information, complete Form 4797, Form 1120 Schedule D. Form 8949, and page 1 of Form 1120 for Heather Corporation. Bring the applicable numbers from Schedule D and Form 4797 to the appropriate lines on page 1 of Form 1120. Heather's employer identification number is 39-123456. The forms can be downloaded from the IRS web page at www.irs.gov, or you may use any tax software program to complete the project. You may work with one other student on this project. If you work with someone else, turn in only one project for the team, and place the names of the students who worked on the project on the first page of your project. Due Date: Thursday, March 26", by 5:00p.m. Check Figures: The check figures are: 1. Net Section 1231 gain (before determining any effect from nonrecaptured Section 1231 losses) is S525,000 (line 7 Form 4797); and 2. Total ordinary income is $967,000 (line 17, Form 4797). Heather Corporation owns and operates a clothing manufacturing company. The corporation reported the following property transactions during 2019: 1. Sale of real estate (unimproved) that has been used as an employee parking lot for S210,000 in April. The lot was purchased in 1998 for $120,000. 2 Sale of office furniture used in the business for $23,000 in December. The furniture was purchased in February 2019 for $25,000 $7,000 in tax depreciation has been claimed on the furniture using accelerated depreciation (If straight-line depreciation had been elected, $3,000 in depreciation expense would have been claimed.) 3. Sale of 2,500 shares of Biotech Corporation common stock for $30 per share in October. The shares were purchased in January 2019 for S24 per share and have been held for investment purposes. This sale transaction was reported to Heather on Form 1099-B showing the stock basis was reported to the IRS 4. Sale of an office building for $2,800,000 in May. The building was purchased in 2000 for $3,600,000. Depreciation of $1,950,000 has been claimed on the building. 5. Sale of factory equipment for $425,000 in July. The equipment was purchased in 2014 for $375,000 $240,000 in tax depreciation has been claimed on the machine using accelerated depreciation (If straight-line depreciation had been elected, S195,000 in depreciation expense would have been claimed.) 6. Sale of 4,000 shares of Windstar, Inc., common stock for $10 per share in June. The 4,000 shares were purchased in May 2017, for $25 per share and have been held for investment purposes. This sale transaction was reported to Heather on Form 1099-B showing the stock basis was reported to the IRS 7. Sale of a factory building in March for $4,500,000. The building was purchased in 2016 for $3,250,000. Depreciation of $800,000 has been claimed on the building. 8. Sale of a factory machine for $1,075,000 in August. The machine was purchased in January 2016 for $4,900,000 $1,400,000 in tax depreciation has been claimed on the building using accelerated depreciation. (If straight-line depreciation had been elected, $860,000 in depreciation expense would have been claimed.) Sale of copier machine for $2,000 in November. The copier was purchased in March 2018 for $6,000 and, for tax purposes, was fully depreciated in 2018 using Section 179. (If straight-line depreciation had been elected, $1,500 in depreciation expense would have been claimed.) Heather Corporation also has a $175,000 capital loss carryforward available from 2015. The company reported the following net Section 1231 gains and losses in previous years: 10 000 2016 (5280 000) 2016 for $4,900,000. S1,400,000 in tax depreciation has been claimed on the building using accelerated depreciation. (If straight-line depreciation had been elected, S860,000 in depreciation expense would have been claimed.) 9 Sale of copier machine for $2,000 in November. The copier was purchased in March 2018 for S6,000 and, for tax purposes, was fully depreciated in 2018 using Section 179. (If straight-line depreciation had been elected, $1,500 in depreciation expense would have been claimed.) Heather Corporation also has a $175,000 capital loss carryforward available from 2015. The company reported the following net Section 1231 gains and losses in previous years: 2013 $150,000 2014 ($320,000) 2015 $450,000 2016 ($280,000) 2017 ($270,000) 2018 $220,000 Required: (25.0 points) Using the above information, complete Form 4797, Form 1120 Schedule D. Form 8949, and page 1 of Form 1120 for Heather Corporation. Bring the applicable numbers from Schedule D and Form 4797 to the appropriate lines on page 1 of Form 1120. Heather's employer identification number is 39-123456. The forms can be downloaded from the IRS web page at www.irs.gov, or you may use any tax software program to complete the project. You may work with one other student on this project. If you work with someone else, turn in only one project for the team, and place the names of the students who worked on the project on the first page of your project. Due Date: Thursday, March 26", by 5:00p.m. Check Figures: The check figures are: 1. Net Section 1231 gain (before determining any effect from nonrecaptured Section 1231 losses) is S525,000 (line 7 Form 4797); and 2. Total ordinary income is $967,000 (line 17, Form 4797)