On February 12, 2005, Nancy Trout and Delores Lake formed Kingfisher Corporation to sell fishing tackle. Pertinent information regarding Kingfisher is summarized as follows: Kingfisher's business address is 1717 Main Street, Ely, MN 55731; its telephone number is (218) 555-2211; and its e-mail address is kingfisher@kf.com. The employer identification number is 11-1111113, and the principal business activity code is 451110. Nancy owns 50% of the common stock and is president of the company, and Delores owns 50% of the common stock and is vice president of the company. No other class of stock is authorized. Both Nancy and Delores are full-time employees of Kingfisher. Nancy's Social Security number is 123-45-6788, and Delores's Social Security number is 123-45-6787. Kingfisher is an accrual method, calendar year taxpayer. Inventories are determined using FIFO and the lower of cost or market method. Kingfisher uses the straight-line method of deprecation for book purposes and accelerated depreciation (MACRS) for tax purposes. During 2019, the corporation distributed cash dividends of $80,000. Kingfisher's financial statements for 2019 are shown below and on the next page. Income Statement Income $2,408,000 (80,000) $2,328,000 (920,000) $1,408,000 Gross sales Sales returns and allowances Net sales Cost of goods sold Gross profit Dividends received from stock investments in less-than-20%- owned U.S. corporations Interest income: State bonds Certificates of deposit Total income 12,000 $14,000 10,000 24,000 $1,444,000 $160,000 160,000 $320,000 290,000 85,000 56,000 $12,000 8,000 Expenses Salaries-officers: Nancy Trout Delores Lake Salaries-clerical and sales Taxes (state, local, and payroll) Repairs and maintenance Interest expense: Business loans Loan to purchase state bonds Advertising Rental expense Depreciation* Charitable contributions Employee benefit programs Premiums on term life insurance policies on lives of Nancy Trout and Delores Lake; Kingfisher is the designated beneficiary Total expenses Net income before taxes Federal income tax Net income per books 20,000 6,000 68,000 40,000 15,000 24,000 16,000 (940,000) $504,000 (106,680) $397,320 Assets Cash Trade notes and accounts receivable Inventories State bonds Federal income tax refund Certificates of deposit Stock investments Buildings and other depreciable assets Accumulated depreciation Land Other assets Total assets Balance Sheet January 1, 2019 $380,000 308,400 900,000 160,000 -0- 140,000 300,000 240,000 (88,800) 20,000 3,600 $2,363,200 December 31, 2019 $337,300 480,280 1,012,000 160,000 1,320 140,000 300,000 240,000 (128,800) 20,000 2,000 $2,564,100 Liabilities and Equity Accounts payable Other current liabilities Mortgages Capital stock Retained earnings Total liabilities and equity January 1, 2019 $300,000 80,300 210,000 500,000 1,272,900 $2,363,200 December 31, 2019 $233,880 40,000 200,000 500,000 1,590,220 $2,564,100 Required: During 2019, Kingfisher made estimated tax payments of $27,000 each quarter to the IRS. Prepare a Form 1120 for Kingfisher for tax year 2019. Form 1125-E Compensation of Officers (Rev. October 2016) Attach to Form 1120, 1120-C, 1120-F, 1120-REIT, 1120-RIC, or 11205 OMB No. 1545-0123 Department of the Treasury Information about Form 1125-E and its separate instructions is at Internal Revenue Service www.irs.gov/form 1125e. Name Employer identification number Kingfisher Corporation 11-1111113 Note: Complete Form 1125-E only if total receipts are $500,000 or more. See instructions for definition of total receipts. (c) Percent of (b) Social security Percent of stock owned 1 (f) Amount of (a) Name of officer time devoted to number business (d) Common compensation (e) Preferred Nancy Trout 123-45-6788 % % % Delores Lake 123-45-6787 % % % % % % On February 12, 2005, Nancy Trout and Delores Lake formed Kingfisher Corporation to sell fishing tackle. Pertinent information regarding Kingfisher is summarized as follows: Kingfisher's business address is 1717 Main Street, Ely, MN 55731; its telephone number is (218) 555-2211; and its e-mail address is kingfisher@kf.com. The employer identification number is 11-1111113, and the principal business activity code is 451110. Nancy owns 50% of the common stock and is president of the company, and Delores owns 50% of the common stock and is vice president of the company. No other class of stock is authorized. Both Nancy and Delores are full-time employees of Kingfisher. Nancy's Social Security number is 123-45-6788, and Delores's Social Security number is 123-45-6787. Kingfisher is an accrual method, calendar year taxpayer. Inventories are determined using FIFO and the lower of cost or market method. Kingfisher uses the straight-line method of deprecation for book purposes and accelerated depreciation (MACRS) for tax purposes. During 2019, the corporation distributed cash dividends of $80,000. Kingfisher's financial statements for 2019 are shown below and on the next page. Income Statement Income $2,408,000 (80,000) $2,328,000 (920,000) $1,408,000 Gross sales Sales returns and allowances Net sales Cost of goods sold Gross profit Dividends received from stock investments in less-than-20%- owned U.S. corporations Interest income: State bonds Certificates of deposit Total income 12,000 $14,000 10,000 24,000 $1,444,000 $160,000 160,000 $320,000 290,000 85,000 56,000 $12,000 8,000 Expenses Salaries-officers: Nancy Trout Delores Lake Salaries-clerical and sales Taxes (state, local, and payroll) Repairs and maintenance Interest expense: Business loans Loan to purchase state bonds Advertising Rental expense Depreciation* Charitable contributions Employee benefit programs Premiums on term life insurance policies on lives of Nancy Trout and Delores Lake; Kingfisher is the designated beneficiary Total expenses Net income before taxes Federal income tax Net income per books 20,000 6,000 68,000 40,000 15,000 24,000 16,000 (940,000) $504,000 (106,680) $397,320 Assets Cash Trade notes and accounts receivable Inventories State bonds Federal income tax refund Certificates of deposit Stock investments Buildings and other depreciable assets Accumulated depreciation Land Other assets Total assets Balance Sheet January 1, 2019 $380,000 308,400 900,000 160,000 -0- 140,000 300,000 240,000 (88,800) 20,000 3,600 $2,363,200 December 31, 2019 $337,300 480,280 1,012,000 160,000 1,320 140,000 300,000 240,000 (128,800) 20,000 2,000 $2,564,100 Liabilities and Equity Accounts payable Other current liabilities Mortgages Capital stock Retained earnings Total liabilities and equity January 1, 2019 $300,000 80,300 210,000 500,000 1,272,900 $2,363,200 December 31, 2019 $233,880 40,000 200,000 500,000 1,590,220 $2,564,100 Required: During 2019, Kingfisher made estimated tax payments of $27,000 each quarter to the IRS. Prepare a Form 1120 for Kingfisher for tax year 2019. Form 1125-E Compensation of Officers (Rev. October 2016) Attach to Form 1120, 1120-C, 1120-F, 1120-REIT, 1120-RIC, or 11205 OMB No. 1545-0123 Department of the Treasury Information about Form 1125-E and its separate instructions is at Internal Revenue Service www.irs.gov/form 1125e. Name Employer identification number Kingfisher Corporation 11-1111113 Note: Complete Form 1125-E only if total receipts are $500,000 or more. See instructions for definition of total receipts. (c) Percent of (b) Social security Percent of stock owned 1 (f) Amount of (a) Name of officer time devoted to number business (d) Common compensation (e) Preferred Nancy Trout 123-45-6788 % % % Delores Lake 123-45-6787 % % % % % %