John Parsons (123-45-6781) and George Smith (123-45-6782) are 70% and 30% owners, respectively, of Premium, Inc. (11-1111111), a candy company located at 1005 16th Street, Cut and Shoot, TX 77303. Premiums Selection was made on January 15, 2014, its date of incorporation. The following information was taken from the companys 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 93	$ ?
Accounts receivable	93,100	123,104
Inventories	9,607	3,467
Prepaid expenses	8,333	17,582
Building and equipment	138,203	185,348
Accumulated depreciation	(84,235)	(?)
Land	2,000	2,000
Total assets	$214,848	$844,422
Accounts payable	$42,500	$72,300
Notes payable (less than 1 year)	4,500	2,100
Notes payable (more than 1 year)	26,700	24,300
Capital stock	30,000	30,000
Retained earnings	111,148	?
Total liabilities and capital	$214,848	$844,422

Premiums accounting firm provides the following additional information.

Distributions to shareholders	$100,000
Beginning balance, Accumulated adjustments account	111,148

Using the preceding information, prepare a Form 1120S and Schedule K1s for

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