*Please complete the adjustments & taxable income*

Accounts Net Income per Books Adjustments Taxable Income

• Sales Revenue $1,500,000.00
• Cost of Goods Sold ($600,000.00)
• Gross Margin $900,000.00

• Dividends from 10% owned Corporation $2,000.00
• Interest from city issued bonds $500.00
• Capital Gains from sale of real estate $10,000.00

• Salary (payment to a single officer) ($500,000.00)
• Parking fines ($200.00)
• Organizational Expense:

(Total $60,000) Amortize over 10 years

company started this year (1/1/2019) ($6,000.00)

• Bad Debt Expense: (for AR

allowance adjustment; 50% of accrual

amount actually written off) ($15,000.00)

• Owner Expensed his personal

trip to Las Vegas ($3,500.00)

• Guarateed Payments ($7,000.00)
• Goodwill Impairment $0.00
• Capital Loss from sale of equipment ($4,000.00)
• Warrant Expense (Actual

payments = $2,000) ($1,500.00)

• Depreciation Expense:

($10,000 piece of equipment acquired on

6/1/2019. MACRS 5 year property) ($1,000.00)

• Charitable Contributions ($35,000.00)
• Meals and Entertainment ($5,000.00)

Net Income $334,300.00 $0.00 $0.00

*Identify the $ value that is ordinary or separately stated*

Accounts Ordinary Items Separately Stated Items

Sales Revenue

Cost of Goods Sold

Gross Margin

Dividends from 10% owned Corporation

Interest from city issued bonds

Capital Gains from sale of real estate

Salary (payment to a single officer)

Parking fines

Organizational Expense (Total $60,000) Amortize over 10 years company started this year (1/1/2019)

Bad Debt Expense (for AR allowance adjustment; 50% of accrual amount actually written off)

Owner Expensed his personal trip to Las Vegas

Guarateed Payments

Goodwill Impairment

Capital Loss from sale of equipment

Warrant Expense (Actual payments = $2,000)

Depreciation Expense ($10,000 piece of equipment acquired on 6/1/2019. MACRS 5 year property)

Charitable Contributions

Meals and Entertainment

Net Income $0.00 $0.00