I need help with the K-1. I have attached the information given. I completed the 1120 S (attached). For the K-1, I am unsure if I should include bonus and salary information on the income in addition to Schedule K income amount of 985,350. I need confirmation regarding that and to make sure the other items listed are correct on the K-1 (attached). I only have one shareholder and I can do the rest once I understand the correct way to add income. Thank you!

If "Yes," enter the amount from Form 8996, line 13 $ Total amount Shareholders' Pro Rata Share Items . Form 1120S Financial Statements (GAAP): Clothes R Us, Inc. Balance Sheet Form 1120S (2018) Page 4 Instructions: Calculate the Taxable Income for 2018. Prepare a 2018 S Corporation Form 1120 \& Schedule K-1 (form 1120) tax return for Clothes R Us, Inc., using the following information found below [Complete page 1 , Schedule K, L, \& M-1 on Form 1120 S and Schedule K-1 (Form 1120S)]. Use your own judgement (along with your just calculations. Clothes R Us, Inc. (CRU) is organized as a corporation in the state of Maine and is taxed as an "S" corporation with a calendar-year end. CRU operates four small boutique clothing outlet stores (family clothing stores) in the Maine cities of Presque Isle, Durham, Raleigh, and Winston-Salem. CRU's address, are as follows: Clothes R Us, Inc. 181 Main Street Presque Isle, Main 126592345 Effective date of the S election was January 1, 2018. CRU has been at the same address since inception. CRU has only common shares issued. There are currently 10,000 shares of CRU common stock outstanding and issued. There were no stock transfers during the current tax year. CRU is owned by the following unrelated four shareholders: Mitch Mumford 85 Shady Elm Presque Isle, Maine, 28201 SSN 524-31-3493 Number of common shares owned 4,300 Chief Executive Officer 2018 W-2 wages $112,000 Susan Sailboat RD Route 843 Rural Hall, Maine 27045 SSN 482-26-5241 Number of common sh Chief Financial Officer 2018 W-2 wages $90,000 Lucy Lollipop Lucy Lollipop 35 S. Main Street 35 S. Main Street Mt. Airy, Maine 27030 SSN 545-16-4239 Number of common shares owned 2,200 Chief Operations Officer Chief Operations Officer 2018 W-2 wages $80,000 Helen Crockpot 9851 Old Colonial Highway Presque Isle, Maine, 28201 SSN 429-82-9384 Number of common shares owned 1,200 Not an officer of the company CRU reported the following information for the year: - CRU uses the accrual method of accounting. - CRU is not a subsidiary nor is it in an affiliated group with any other entity. - CRU does not own directly 20%, or, directly and indirectly, 20% or more of any other entity (including corporations or partnerships). - CRU has never issued any restrictive stock. - CRU has never issued any publicly traded debt. - CRU was never a C Corporation. CRU made payments in the current year that required the filing of Forms 1099. All of those Forms 1099 were filed timely. Additional information: None of the expenses incurred by CRU during the year relate to the production or carrying of the taxexempt securities held in portfolio. The tax-exempt securities are maintained in a separate brokerage exempt securities held in portfolio. The account distinct from other holdings. CRU maintains its inventory on the cost method. CRU uses specific identification for its inventory and has never changed its inventory method. CRU has never written down any subnormal goods. The rules of Section 263A (UNICAP) do not apply to CRU. CRU leases all of its real property. On December 1, 2018, CRU made a distribution to all common stockholders of $85 per common share. On July 1, 2018, CRU purchased $640,000 of new equipment (5-year MACRS property) that it used to expand its Presque Isle store. Not including the $640,000 of new additions during the year, CRU's calculated regular and AMT tax depreciation for the current year is $275,000. CRU desires to maximize its current year cost recovery deductions relating to the equipment additions. Other than the unimproved land, CRU did not dispose of any assets during the year. CRU maintains a life insurance policy on the life of the CEO, Mitch Mumford. CRU is the beneficiary of that policy. During the current year, CRU gave $32,000 in cash to the Red Cross to assist with hurricane disaster During the current year, CRU clean-up in the Maine area. All of the accrued wage amounts on the balance sheet as of December 31, 2018 were paid on January 15, 2018. The accrued bonus amounts on the balance sheets as of December 31, 2017 and 2018, respectively, were paid on July 1, 2017 and July 1, 2018, respectively. As of December 31, 2017 and 2018, respectively, CRU had accrued vacation on its books of $19,000 and $21,000. As of March 15, 2017 and March 15, 2018, respectively, CRU had paid $3,000 and $9,000 of those accrued amounts. None of these accrued amounts relate to officers' compensation. There were no changes in stock ownership during the year. The three officers in the company devoted 100% of their time to the company. 3 b?111? Final K-1 Amended K-1 OMB No. 1545-0123 Schedule K-1 (Form 1120S) Department of the Treasury Internal Revenue Service 2(1) 18 For calendar year 2018 , or tax year begiming 01/01/,12,31,2018 Shareholder's Share of Income, Deductions, Credits, etc. Part III Shareholder's Share of Current Year Income, Deductions, Credits, and Other Items If "Yes," enter the amount from Form 8996, line 13 $ Total amount Shareholders' Pro Rata Share Items . Form 1120S Financial Statements (GAAP): Clothes R Us, Inc. Balance Sheet Form 1120S (2018) Page 4 Instructions: Calculate the Taxable Income for 2018. Prepare a 2018 S Corporation Form 1120 \& Schedule K-1 (form 1120) tax return for Clothes R Us, Inc., using the following information found below [Complete page 1 , Schedule K, L, \& M-1 on Form 1120 S and Schedule K-1 (Form 1120S)]. Use your own judgement (along with your just calculations. Clothes R Us, Inc. (CRU) is organized as a corporation in the state of Maine and is taxed as an "S" corporation with a calendar-year end. CRU operates four small boutique clothing outlet stores (family clothing stores) in the Maine cities of Presque Isle, Durham, Raleigh, and Winston-Salem. CRU's address, are as follows: Clothes R Us, Inc. 181 Main Street Presque Isle, Main 126592345 Effective date of the S election was January 1, 2018. CRU has been at the same address since inception. CRU has only common shares issued. There are currently 10,000 shares of CRU common stock outstanding and issued. There were no stock transfers during the current tax year. CRU is owned by the following unrelated four shareholders: Mitch Mumford 85 Shady Elm Presque Isle, Maine, 28201 SSN 524-31-3493 Number of common shares owned 4,300 Chief Executive Officer 2018 W-2 wages $112,000 Susan Sailboat RD Route 843 Rural Hall, Maine 27045 SSN 482-26-5241 Number of common sh Chief Financial Officer 2018 W-2 wages $90,000 Lucy Lollipop Lucy Lollipop 35 S. Main Street 35 S. Main Street Mt. Airy, Maine 27030 SSN 545-16-4239 Number of common shares owned 2,200 Chief Operations Officer Chief Operations Officer 2018 W-2 wages $80,000 Helen Crockpot 9851 Old Colonial Highway Presque Isle, Maine, 28201 SSN 429-82-9384 Number of common shares owned 1,200 Not an officer of the company CRU reported the following information for the year: - CRU uses the accrual method of accounting. - CRU is not a subsidiary nor is it in an affiliated group with any other entity. - CRU does not own directly 20%, or, directly and indirectly, 20% or more of any other entity (including corporations or partnerships). - CRU has never issued any restrictive stock. - CRU has never issued any publicly traded debt. - CRU was never a C Corporation. CRU made payments in the current year that required the filing of Forms 1099. All of those Forms 1099 were filed timely. Additional information: None of the expenses incurred by CRU during the year relate to the production or carrying of the taxexempt securities held in portfolio. The tax-exempt securities are maintained in a separate brokerage exempt securities held in portfolio. The account distinct from other holdings. CRU maintains its inventory on the cost method. CRU uses specific identification for its inventory and has never changed its inventory method. CRU has never written down any subnormal goods. The rules of Section 263A (UNICAP) do not apply to CRU. CRU leases all of its real property. On December 1, 2018, CRU made a distribution to all common stockholders of $85 per common share. On July 1, 2018, CRU purchased $640,000 of new equipment (5-year MACRS property) that it used to expand its Presque Isle store. Not including the $640,000 of new additions during the year, CRU's calculated regular and AMT tax depreciation for the current year is $275,000. CRU desires to maximize its current year cost recovery deductions relating to the equipment additions. Other than the unimproved land, CRU did not dispose of any assets during the year. CRU maintains a life insurance policy on the life of the CEO, Mitch Mumford. CRU is the beneficiary of that policy. During the current year, CRU gave $32,000 in cash to the Red Cross to assist with hurricane disaster During the current year, CRU clean-up in the Maine area. All of the accrued wage amounts on the balance sheet as of December 31, 2018 were paid on January 15, 2018. The accrued bonus amounts on the balance sheets as of December 31, 2017 and 2018, respectively, were paid on July 1, 2017 and July 1, 2018, respectively. As of December 31, 2017 and 2018, respectively, CRU had accrued vacation on its books of $19,000 and $21,000. As of March 15, 2017 and March 15, 2018, respectively, CRU had paid $3,000 and $9,000 of those accrued amounts. None of these accrued amounts relate to officers' compensation. There were no changes in stock ownership during the year. The three officers in the company devoted 100% of their time to the company. 3 b?111? Final K-1 Amended K-1 OMB No. 1545-0123 Schedule K-1 (Form 1120S) Department of the Treasury Internal Revenue Service 2(1) 18 For calendar year 2018 , or tax year begiming 01/01/,12,31,2018 Shareholder's Share of Income, Deductions, Credits, etc. Part III Shareholder's Share of Current Year Income, Deductions, Credits, and Other Items