John Parsons $(123-45-6781)$ and George Smith $(123-45-6782)$ are $70\%$ and $30\%$ owners, respectively, of Premium, Inc. $(11-1111120),$ a candy company located at $100516$th Street, Cut and Shoot, TX $77303.$ Premium's S election was made on January $15,2012,$ its date of incorporation. The following information was taken from the company's $2021$ income statement.

Interest income $ $100,000$

Gross sales receipts $2,410,000$

Beginning inventory $9,607$

Direct labor $(203,102)$

Direct materials purchased $(278,143)$

Direct other costs $(249,356)$

Ending inventory $3,467$

Salaries and wages $(442,103)$

Officers' salaries $($$$75,000$ each to Parsons and Smith$)(150,000)$

Repairs $(206,106)$

Depreciation expense, tax and book $(15,254)$

Interest expense $(35,222)$

Rent expense $($operating$)(40,000)$

Taxes $(65,101)$

Charitable contributions $($cash$)(20,000)$

Advertising expenses $(20,000)$

Payroll penalties $(15,000)$

Other deductions $(59,899)$

Book income $704,574$

A comparative balance sheet appears below.

January $1,2021$ December $31,2021$

Cash $ $47,840$ $ $?$

Accounts receivable $93,100123,104$

Inventories $9,6073,467$

Prepaid expenses $8,33317,582$

Building and equipment $138,203185,348$

Accumulated depreciation $(84,235)(?)$

Land $2,0002,000$

Total assets $$214,848$ $$844,422$

Accounts payable $ $42,500$ $ $72,300$

Notes payable $($less than $1$ year$)4,5002,100$

Notes payable $($more than $1$ year$)26,70024,300$

Capital stock $(100$ shares outstanding$)30,00030,000$

Retained earnings $$111,148?$

Total liabilities and capital $$214,848$ $$844,422$

Premium's accounting firm provides the following additional information.

Distributions to shareholders $($not reported on Form $1099-$DIV and

made based on percentage of ownership$)$:

$$100,000$

Beginning balance, Accumulated adjustments account: $111,148$

Ordinary business income for QBI: $639,574$

W$-2$ wages for QBI: $795,205$

UBIA of qualified property $125,000$

Required:

Prepare Premium's Form $1120$S$,$ Additional Information $-$ Continuation Statement, and Schedule K$-1$s for John Parsons and George Smith, $560720$th Street, Cut and Shoot, TX $77303.$Form $1120-$S$,$ A S election effective date

$1/15/2012$ TYPE

OR

PRINT Premium, Inc.

$100516$th Street

Cut and Shoot, TX $77303$ D Employer identification number

$11-1111120$

B Business activity code

number $($see instructions$)$

$311300$ E Date incorporated

$1/15/2012$

C Check if Schedule

M$-3$ attached $$ F Total assets $($see instructions$)$

$fill in the blank dc$116101$ffcbfdf$\_1$

$214,848$

G Is the corporation electing to be an S corporation beginning with this tax year? See instructions. $$ Yes $$ No

H Check if: $(1)$ Final return $(2)$ Name change $(3)$ Address change $(4)$ Amended return $(5)$ S election termination

I Enter the number of shareholders who were shareholders during any part of the tax year $...........................2$

J Check if corporation: $(1)$ Aggregated activities for section $465$ at$-$risk purposes $(2)$ Grouped activities for section $469$ passive activity purposes

Caution: Include only trade or business income and expenses on lines $1$a through $21.$ See the instructions for more information.

$1$a Gross receipts or sales $.....................................1$a fill in the blank dc$116101$ffcbfdf$\_2$

$2,410,000$

b Returns and allowances $....................................1$b

c Balance. Subtract line $1$b from line $1$a $.............................................1$c fill in the blank dc$116101$ffcbfdf$\_3$

$2,410,000$

$2$ Cost of goods sold $($attach Form $1125-$A$)..........................................2$ fill in the blank dc$116101$ffcbfdf$\_4$

$154,676$

$3$ Gross profit. Subtract line $2$ from line $1$c $...........................................3$ fill in the blank dc$116101$ffcbfdf$\_5$

$4$ Net gain $($loss$)$ from Form $4797,$ line $17($attach Form $4797).............................4$

$5$ Other income $($loss$)($see instrs $$ att statement$).....................................5$

$6$ Total income $($loss$).$ Add lines $3$ through $5.................................. There are 3 Steps involved in it Step: 1 Get Instant Access to Expert-Tailored Solutions See step-by-step solutions with expert insights and AI powered tools for academic success Step: 2 Step: 3 Ace Your Homework with AI Get the answers you need in no time with our AI-driven, step-by-step assistance Get Started Recommended Textbook for Cost Accounting Concepts And Applications For Managerial Decision Making Authors: Ralph S. Polimeni, James A. Cashin, Frank J. Fabozzi, Arthur H. Adelberg 2nd Edition 0070103100, 978-0070103108 More Books Students also viewed these Accounting questions Question ★★★★★ What is master production scheduling and how is it done? Answered: 1 week ago Question ★★★★★ 4. When sales were at their highest at 500,000 units, total costs were $750,000. When sales were at their lowest at 200,000 units, total costs were $420,000. Find the variable cost per unit. Answered: 1 week ago Question ★★★★★ 3. Appreciate the limitations of the research into crime linkage and offender profiling. Answered: 1 week ago Question ★★★★★ The comparative income statements and balance sheets of Sarot, Inc., Compute the amount and percentage changes for the income statement, and comment on the changes from 2011 to 2012. Sarot, Inc.... Answered: 1 week ago Question ★★★★★ 1. The jQuery's hover event method requires two functions to set up the event handlers for two events: when a mouse pointer moves into and out of the element True False... Answered: 1 week ago Question ★★★★★ 20 pts. Solver settings must be saved. Project-Selection Team at ABC must evaluate 50 three Managers: 22 The company has a limited budget each year and limit Budget Year 1: 2200 The company policy... Answered: 1 week ago Question ★★★★★ Serena is a paralegal at a law firm in a small southern town. She studied history in college and completed her paralegal education and certification before moving from a big city to the rural area.... Answered: 1 week ago Question ★★★★★ Research on laws, programs, best practices of the government, NGOs and communities in response to the challenge of climate change in the Philippines. Make a reflection on how the problems of solid... Answered: 1 week ago Question ★★★★★ Thomas Anderson manufactures and sells homemade wine, and he wants to develop a standard cost per litre. The following are required for production of a 150-litre batch: 72.00 litres of grape... Answered: 1 week ago Question ★★★★★ A contract in writing was entered into between buyer A and seller B for the sale of 200,000 tons of quartz sand to be delivered in four loads of 50,000 tons per week as required, with each delivery... Answered: 1 week ago Question ★★★★★ Part A In the following paragraph, you will read about the study of emerging explorer Prof. Harrison. Conjugate the verbs in parentheses to agree with the subjects. My friends and I ______________... Answered: 1 week ago Question ★★★★★ Is it important to evaluate a creative idea before it becomes an innovation? Answered: 1 week ago Question ★★★★★ Team development stages state that most people coming to a new group are enthusiastic, but that with time they lose some of their morale. What types of things happen in most groups to cause this... Answered: 1 week ago Question ★★★★★ Select a work or sports team to which you belong/have belonged. Which team member (not the manager or coach) had the highest level of status? Identify the factors that contributed to that persons... Answered: 1 week ago Previous Question Next Question View Answer in SolutionInn App Services Sitemap Fun Definitions Become Tutor Study Help Categories Recent Questions Expert Questions Company Info Security Copyrights Privacy Policy Terms & Conditions SolutionInn Fee Scholarship Get In Touch About Us Contact Us Career Jobs FAQ Campus Ambassador Secure Payment Download Our App © 2024 SolutionInn. All Rights Reserved $