Heron Corporation, a calendar year, accrual basis taxpayer, provides the following information: Net income per books (after-tax) $138,000 Capital gains included in this year's books income 5,000 Capital loss carried forward from previous year, not deductible last year 7,000 Interest income from tax-exempt bonds 4,000 Life insurance proceeds received as a result of death of Heron's president 100,000 Rental income received in December for the next year. Books are on GAAP 9,000 accounting. Premiums paid on policy on life of Heron's president 5,600 Federal income tax provision per books 26,000 Charitable contributions made this year in excess of taxable income limit 3,000 Tax depreciation in excess of books depreciation 15,000 Retained earnings at beginning of year 285,000 Cash dividends paid 65,000 1 4 5 Schedule M-1 Reconciliation of Income (Loss) per Books With Income per Return Note: The corporation may be required to file Schedule M-3. See instructions. Net income (loss) per books 7 7 Income recorded on books this year 2 Federal income tax per books.... not included on this return (itemize): 3 Excess of capital losses over capital gains Tax-exempt interests Income subject to tax not recorded on books this year (itemize): 8 Deductions on this return not charged Expenses recorded on books this year not against book income this year (itemize): deducted on this return (itemize): a Depreciation.. a Depreciation b Charitable contributions $ b Charitable contributions $ c Travel and entertainment. $ 9 Add lines 7 and 8 6 Add lines 1 through 5 10 Income (page 1, line 28) ---line 6 less line 9 Schedule M-2 Analysis of Unappropriated Retained Earnings per Books (Schedule L, Line 25) 1 Balance at beginning of year 5 Distributions: a Cash. 2 Net income (loss) per books 3 Other increases (itemize): c Property 6 Other decreases (itemize): 7 Add lines 5 and 6 4 Add lines 1, 2, and 3 1 8 Balance at end of year (ine 4 less line 7) b Stock Form 1120 (2020) Please complete the Schedule M-1 and M-2. You will NOT be able to type into the form. Please fill in each line answer provided below. Do NOT use any commas in your amounts. Type none for the amount if zero, do not enter numeric 0. Schedule M-1: Line 1. Net income (loss) per books 138000 Line 2. Federal income tax per books 26000 Line 3. Excess of capital losses over capital gains Line 4. Income subject to tax not recorded on books this year Line 5a. Depreciation expense on books not deducted in this return Line 5b. Charitable contributions expense on books not deducted in this return Line 5 under c: Other expense recorded on books not deducted in this return Line 6. Subtotal left side of M-1 Line 7a. Tax exempt interest from books that is not included in tax return Line 7 under Tax exempt interest: Other income from books that is not taxable in this return Line 8a. Depreciation expense deducted in this return not charged against book income Line 85. Charitable contributions deducted in this return not charged against book income Line 8 under 8b: Other deductions in this return not charged againsts book income Line 9. Subtotal deductions right side of the M-1 Line 10. Taxable income per the tax return Schedule M-2: Line 1. Balance of retained earnings) at beginning of year Line 2. Net income per books Line 4. Subtotal left side of M-2 Line 5a. Cash distributions Line 7. Subtotal right side of M-2 Line 8. Balance of retained earnings) at end of year Heron Corporation, a calendar year, accrual basis taxpayer, provides the following information: Net income per books (after-tax) $138,000 Capital gains included in this year's books income 5,000 Capital loss carried forward from previous year, not deductible last year 7,000 Interest income from tax-exempt bonds 4,000 Life insurance proceeds received as a result of death of Heron's president 100,000 Rental income received in December for the next year. Books are on GAAP 9,000 accounting. Premiums paid on policy on life of Heron's president 5,600 Federal income tax provision per books 26,000 Charitable contributions made this year in excess of taxable income limit 3,000 Tax depreciation in excess of books depreciation 15,000 Retained earnings at beginning of year 285,000 Cash dividends paid 65,000 1 4 5 Schedule M-1 Reconciliation of Income (Loss) per Books With Income per Return Note: The corporation may be required to file Schedule M-3. See instructions. Net income (loss) per books 7 7 Income recorded on books this year 2 Federal income tax per books.... not included on this return (itemize): 3 Excess of capital losses over capital gains Tax-exempt interests Income subject to tax not recorded on books this year (itemize): 8 Deductions on this return not charged Expenses recorded on books this year not against book income this year (itemize): deducted on this return (itemize): a Depreciation.. a Depreciation b Charitable contributions $ b Charitable contributions $ c Travel and entertainment. $ 9 Add lines 7 and 8 6 Add lines 1 through 5 10 Income (page 1, line 28) ---line 6 less line 9 Schedule M-2 Analysis of Unappropriated Retained Earnings per Books (Schedule L, Line 25) 1 Balance at beginning of year 5 Distributions: a Cash. 2 Net income (loss) per books 3 Other increases (itemize): c Property 6 Other decreases (itemize): 7 Add lines 5 and 6 4 Add lines 1, 2, and 3 1 8 Balance at end of year (ine 4 less line 7) b Stock Form 1120 (2020) Please complete the Schedule M-1 and M-2. You will NOT be able to type into the form. Please fill in each line answer provided below. Do NOT use any commas in your amounts. Type none for the amount if zero, do not enter numeric 0. Schedule M-1: Line 1. Net income (loss) per books 138000 Line 2. Federal income tax per books 26000 Line 3. Excess of capital losses over capital gains Line 4. Income subject to tax not recorded on books this year Line 5a. Depreciation expense on books not deducted in this return Line 5b. Charitable contributions expense on books not deducted in this return Line 5 under c: Other expense recorded on books not deducted in this return Line 6. Subtotal left side of M-1 Line 7a. Tax exempt interest from books that is not included in tax return Line 7 under Tax exempt interest: Other income from books that is not taxable in this return Line 8a. Depreciation expense deducted in this return not charged against book income Line 85. Charitable contributions deducted in this return not charged against book income Line 8 under 8b: Other deductions in this return not charged againsts book income Line 9. Subtotal deductions right side of the M-1 Line 10. Taxable income per the tax return Schedule M-2: Line 1. Balance of retained earnings) at beginning of year Line 2. Net income per books Line 4. Subtotal left side of M-2 Line 5a. Cash distributions Line 7. Subtotal right side of M-2 Line 8. Balance of retained earnings) at end of year