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Olive Corporation was formed and began operations on January 1, 2019. The corporation's income statement for the year and the balance sheet at year-end are

Olive Corporation was formed and began operations on January 1, 2019. 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, 2019
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 wages 30,000
Bad debts (direct charge-offs) 9,000
Repairs 3,000
Depreciation for book and tax purposes 10,000
Advertising 2,000
Payroll taxes 16,000
Total other expenses (147,000)
Net income (before federal income tax expense) $33,000
The Olive Corporation Balance Sheet as of December 31, 2019
Assets:
Cash $30,000
Accounts receivable 20,000
Inventory (at cost) 70,000
Equipment 90,000
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 stock 80,000
Retained earnings 28,800
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 2020 estimated tax.

Required: Prepare Form 1120.

  1. Enter all amounts as positive numbers, except for a "loss". If required, enter a "loss" as a negative number on the tax form.
  2. If an amount box does not require an entry, or the answer is zero, enter "0".

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