I have some of it filled out but need help with the rest
Olive Corporation was formed and began operations on January 1, 2018. The corporation's income statement for the year and the balance sheet at year-end are presented below.
The Olive Corporation Income Statement
for the Year Ended December 31, 2018
Gross income from operations$270,000
Qualified dividends received from a 35
percent-owned domestic corporation 20,000
Total gross income$290,000
Cost of goods sold(110,000)
Total income$180,000
Other expenses:
Compensation of officers$77,000
Salaries and wages30,000
Bad debts (direct charge-offs)9,000
Repairs3,000
Depreciation for book and tax purposes10,000
Advertising2,000
Payroll taxes16,000
Total other expenses(147,000)
Net income (before federal income tax expense)$33,000
The Olive Corporation Balance Sheet
as of December 31, 2018
Assets:Cash$30,000
Accounts receivable20,000
Inventory (at cost)70,000
Equipment90,000
Less: accumulated depreciation(10,000)
Total assets
$200,000
Liabilities and owners' equity:
Accounts payable$ 6,200
Note payable (due in 10 years)85,000
Common stock80,000
Retained earnings28,800
Total liabilities and owners' equity$200,000
The corporation made estimated tax payments of $5,000 and the corporation's book federal income tax expense is equal to the federal tax liability. Assume any overpayment is credited to the 2019 estimated tax.
Required:
Prepare Form 1120.
- Enter all amounts as positive numbers, except for a "loss". If required, enter a "loss" as a negative number on the tax form.
- If an amount box does not require an entry, or the answer is zero, enter "0".
A Check if: lame B Employer 1a Consolidated return (attach identification Form 851) . . . The Olive Corporation number b Lifeonlife consolidated Number, street, and room or suite no. If a P.O. box, see instructions. C Date incorporated return . . TYPE 2 Personal holding co. OR (attach Sch. PH) . . . . . PRINT 01/01/18 3 Personal service corp. (see City or town, state, or province, country, and ZIP or foreign postal code D Total assets (see instructions) . . . . instructions) 200,000 Schedule M-3 attached D E Check if: (1) : Initial return (2) . Final return (3) . Name change (4) @ Address change 1a Gross receipts or sales . 1a 270,000 b Returns and allowances . 1b C Balance. Subtract line 1b from line 1a 1c N Cost of goods sold (attach Form 1125-A) . . 110,0 Gross profit. Subtract line 2 from line 1c . . . . . . . . . . . . . . . . . . .. .assessesvisitsvaidiksis 3 160,000 Dividends (Schedule C, line 19) . . . . 6,000 Income Interest . 5 Gross rents . . . . . . 6 Gross royalties . . . . 7 Capital gain net income (attach Schedule D (Form 1120)) . . . . . . 8 9 6 Net gain or (loss) from Form 4797, Part II, line 17 (attach Form 4797) . . . . . . . . . . . . . . . . . . . . is . 10 Other income (see instructions-attach statement) . . . . . . . . 10 11 Total income. Add lines 3 through 10 . . . . . . . . . w ww ww ww wwwwwwwwvivaswissvivvisit 11 166,000 Compensation of officers (see instructions-attach Form 1125-E) . . . . . . 12 77,000 13 Salaries and wages (less employment credits) . . . . . 13 30,000 14 Repairs and maintenance . . 14 3,000 15 Bad debts . . 15 9,000 16 Rents 16 17 Taxes and licenses . . . . . 17 16,000 for limitations on deductions.) 18 Interest (see instructions) . . . . . . . 18 19 C Charitable contributions . . 19 20 Depreciation from Form 4562 not claimed on Form 1125-A or elsewhere on return (attach Form 4562) . 20 10,000 21 Depletion . . . . . . . 2121 Depletion . . .. . 21 2.2 istructions for ! 22 Advertising . . . . 2,000 23 Pension , profit - sharing , Etc., Plans .... 23 24 ` ins 24 Employee benefit programs ... 25 Reserved for Future USE . .` 25 26 Other deductions [attach statement ) . ..` 26 Deductions !` 27 Total deductions . Add lines 12 through 2` ... ......` 27 147, 000 26 Taxable income before net operating loss deduction and Special deductions . Subtract line 27 from line 1 1 . 28 19, 000 25 a Net operating loss deduction (SEE instructions ] . .` 29 8 6 Special deductions ( Schedule { , line 24 , column ([) ` . . . .```` .````!` 20b [ Add lines 24 8 and 2^ . .. .. . . . . . . . . " " 250 \\" " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " 30 Taxable income . Subtract line 29 [ from line 26. SEE instructions . .. .. .... 3:0 15, 000 31 1. Total tax [Schedule ] , Part I, line [1] ..` 31 32 201& net $65 tax liability paid (Schedule ] , Part II, line 121 .... . 32 BLUQUITE Tar Refundable Cradle, and 3 3. Total payments , credits , and section 965 net tax liability | Schedule ] , Part III , line Z^) . . . . . .. . ..` 3.3 3:4 Estimated tax penalty . SEE instructions . Check if Form ZZZ0 is attached . . 3:4 35 Amount owed . IF line 37 15 smaller than the total of lines 31 , 32 , and 34 , Enter amount OWNED . .... . 3.5 36 Overpayment . IF line }} is larger than the total Of lines 31 , 32, and 34 , Enter amount overpaid . . . . 150 37 \\Enter amount from line If you want : Credited to 2015 estimated tax*` \\5, 00| | Refunded*!` 37 Under penalties of perjury; I declare that I have Examined this return , including accompanying Schedules and statements , and to the best of my knowledge and belief , it is true , correct , and complete . Declaration of preparer ( other than taxpayer ; is based an Sign all information of which preparer has any knowledge . Here May the IRS discuss this return with the preparer shown below ?" Signature of officer Date Title SEE instructions . A Y'ES O NO Paid Print , Type preparer's name* Preparer's Signature Date Check & if SELF - FTI'M` Employed Preparer Firm's name #` Firm's ELN ` Use Only* Firm's address*` Phone no . FOR Paperwork Reduction Act Notice , See SeparatE instructions . _at . No . 11450 0 Farm 1 120 12018 )Form LIZD IZZLE! The Olive Corporation Page 2 Dividends , Inclusions , and Special Deductions ( SEE instructions!* ( a ) Dividends and inclusions ( b ) `` ( c ) Special deductions ( a )* ( b ) 1 Dividends from less - than - 203/4 - owned domestic corporations (other than debt - Financed stack's ..... 50 2 Dividends from 2046_ OF _ more - owned domestic corporations (other than debt - Financed stack] ... 5 5 Dividends on certain debt - financed stack of domestic and foreign corporations SEE E instructions Dividends on certain preferred stock Of less - than - 209/16 - owned public utilities 23.3 5. Dividends on certain preferred stack of LOY'`- OF - more - owned public utilities 26. 7 5. Dividends from less - than - 209/6 - owned foreign corporations and certain FEES 51 Dividends from ZOY' - or- more - owned foreign corporations and certain FEZ'S 5 5 Dividends from wholly owned foreign subsidiaries . .` Subtotal . Add lines 1 through &. SEE instructions for limitations . .` SEE instructions 10 Dividends from domestic corporations received by' a small business investment18 Gross- UP for foreign LIKES DEEMED Fall] . .. . . is IC_DISC and farmer DISC dividends not included on line 1 , 2, or 3 .... 20 I Other dividends . . 21 Deduction for dividends paid an certain preferred stack of public Utilities . . ..` 22 Section 250 deduction [attach Form $:9:53) . ..` 23.' Total dividends and inclusions . Add lines } through 20. Enter here and an page 1 , line & .... 24 Total special deductions . Add lines " through 22, column (cj . Enter here and on Page 1 , line 2^ .. . ......` Form 1 120 (2018) Form LIZ0 /201BY The Olive Corporation* Page ] Tax Computation and Payment ( SEE instructions! Part I - Tax Computation 1 Check if the corporation is a member of a controlled group (attach Schedule { {Form 1 1201 1 . SEE instructions* Income tax . SEE instructions . . ... 3. BASE Erosion minimum tax [attach Farm $941 ) .... # Add lines 2 and 3 . .. .` 5. a Foreign tax credit (attach Form 11 18) . ...` 5.2 6 Credit from Farm $ $34 (SEE instructions ) .... [ General business credit (attach Farm ]^010) . ....` 5 0 ` Credit for prior year minimum tax (attach Form BB 2] ] ....` { {and credits from Form $912 .... 5 0 5. Total credits . Add lines 5 a through GE ...` Subtract line & from line* $ ... Personal holding company tax ( attach SchedulE PH ! Form LIZDYY . ...10 Total . Add lines } } through It . . 1 1 Total tax . Add lines ? , &, and 10 . Enter here and on page 1 , line 31 . .. 1 1 Part II - Section 565 Payments ( SEE instructions*!* 12 201 { net $65 tax liability paid from Farm 965 - E, Part II , column (k) , line 2. Enter here and on page 1 , line 32\\ 12 Part III - Payments , Refundable Credits , and Section 965. Net Tax Liability* 13 2017 overpayment credited to LOVE ... 13 1 4 201 8 Estimated tax payments .. 1 4 15 2018 refund applied for on Form 1465 ...... 15. 16 Combine lines 13 , 14 , and 15 . .. LIE 17 Tax deposited with Form ?` [14 . . is Withholding (see instructions ] ...... 19 Total payments . Add lines 15 , 17, and 18 ..... 1.5 20 Refundable credits from :` a Form 2434 . 202 6 Form A 135 ... 20 b [ Form BBZY, line &[ . . ..` 20 0 & Other (attach statement - SEE instructions ) ..` 20d 21 Total credits . Add lines 20' s through 20d . .... 21 22 201 8 net $65 tax liability from Farm $65 - 6, Part I , column (d), line 2. SEE instructions ...... 23 Total payments , credits , and section 965 net tax liability . Add lines 19, 21 , and 22. Enter here and an page 1 , line } . . . . ... .. " 23 Form 1 120 /20181Balance Sheets per Books* Beginning of tax year End of tax year ( P) Assets ( b ) Cash . .` Za Trade mates and accounts receivable . ..... 6. LESS allowance for bad debts . .. .` 3. Inventories . # U.S . government obligations .... Tax - Exempt securities (SEE instructions ) . . . . 5 Other current assets [attach Statement ! . .. .. Loans to shareholders .. Mortgage and real Estate loans . ..` Other investments lattach statement) ..... 10a Buildings and other depreciable assets. ..... 6 LESS accumulated depreciation ... I la Depletable assetS . . 6 LESS accumulated JEFEtion ..... 12 Land ( net of any amortization ] . ...` 13 a Intangible assets ( amortizable only' ) ....... bo LESS accumulated amortization . . .. .` 14 Other assets ( attach Statements . . . .. .. ... 15 Total ASSETS. .. . . .` \\. . . . " " " " " " " " " " " " " " " " " " " Liabilities and Shareholders" Equity Accounts payable . .. 17 Mortgages , notes , bonds payable in less than 1 year Other current liabilities [ attach statement ; . .. 19 Loans from Shareholders . 20 Mortgages , notes , bands payable in 1 year or more 21 Other liabilities [ attach statement; . . . .. .. . 22 Capital stock : & a Preferred stock . ...... . 6 Common stock ..` 23 Additional paid - in capital . . 24 Retained Earnings - Appropriated (attach statement ; 25 Retained earnings - Unappropriated . ...26 Adjustments to shareholders' equity (attach statement) 27 Less cost of treasury stock 28 Total liabilities and shareholders' equity . . . . 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. 1 N Net income (loss) per books . 7 Income recorded on books this year not included on this return (itemize): 2 Federal income tax per books . Tax-exempt interest $ _ 3 Excess of capital losses over capital gains . . . 4 Income subject to tax not recorded on books this year (itemize): 8 Deductions on this return not charged against book income this year (itemize) : 5 Expenses recorded on books this year not deducted on this return (itemize): a Depreciation . a Depreciation . . $ . b Charitable contributions . . . . . . $ b Charitable contributions . . . . $ . c Travel and entertainment . . . $ 9 A 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 (Line 25, Schedule L) Balance at beginning of year . . 5 Distributions: a Cash . . 2 Net income (loss) per books . b Stock . 3 Other increases (itemize) : . c Property . . . Other decreases (itemize) :_ Add lines 5 and 6 . . . . . . . . Add lines 1, 2, and 3 Balance at end of year (line 4 less line 7) Form 1120 (2018)
