Please do all the ones that are marked wrong! Thank you!

Note: This problem is for the 2019 tax year. On November 1, 2008, Janet Morton and Kim Wong formed Pet Kingdom, Inc., to sell pets and pet supplies. Pertinent information regarding Pet Kingdom is summarized as follows: Pet Kingdom's business address is 1010 Northwest Parkway, Dallas, TX 75225; its telephone number is (214) 555-2211; and its e- mail address is petkingdomn@pki.com. The employer identification number is 11-1111112, and the principal business activity code is 453910, Janet and Kim each own 50% of the common stock; Janet is president and Kim is vice president of the company. No other class of stock is authorized Both Janet and Kim are full-time employees of Pet Kingdom. Janet's Social Security number is 123-45-6788, and Kim's Social Security number is 123-45-6787. Pet Kingdom is an accrual method, calendar year taxpayer. Inventories are determined using FIFO and the lower of cost or market method. Pet Kingdom uses the straight-line method of depreciation for book purposes and accelerated depreciation (MACRS) for tax purposes. During 2019, the corporation distributed cash dividends of $250,000. . Pet Kingdom's financial statements for 2019 are shown below. Income Statement Income Gross sales Sales returns and allowances $5,750,000 (200,000) $5,550,000 (2,300,000) Net sales Cost of goods sold SUU (2,300,000) $3,250,000 43,750 $15,000 120,000 35,000 $3,328,750 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 Expenses Salaries-officers: Janet Morton Kim Worg Salaries-clerical and sales Taxes (state, local, and payroll) Repairs and maintenance Interest expense: Loan to purchase state bonds Other business loans Advertising Rental expense Depreciation Charitable contributions $262,500 262,500 $525,000 725,000 238,000 140,000 $9,000 207,000 216,000 58,000 109,000 106,000 38.000 Balance Sheet Assets Cash Trade notes and accounts receivable Inventories Stock investment State bonds Certificates of deposit Prepaid Federal tax Buildings and other depreciable assets Accumulated depreciation Land January 1, 2019 $1,200,000 2,062,500 2,750,000 1,125,000 375,000 400,000 -0- 5,455,000 (606,000) 812,500 140,000 $13,714,000 December 31, 2019 $1,039,461 2,147,000 3,030,000 1,125,000 375,000 400,000 2,266 5,455,000 (712,000) 812,500 128,500 $13,802,727 Other assets Total assets Llabilities and Equity Accounts payable Other current liabilities Mortgages Capital stock Retained earnings Total liabilities and equity January 1, 2019 $2,284,000 175,000 4,625,000 2,500,000 4,130,000 $13,714,000 December 31, 2019 $1,840,711 155,000 4,575,000 2,500,000 4,732,016 $13,802,727 Required: ScheduleL Balance Sheets per Books Beginning of tax year (b) Assets (c) (d) 1 Cash 1,200,000 1,039,461 2a Trade notes and accounts receivable 2,062,500 2,147,000 b Less allowance for bad debts 2,062,500 2,147,000 3 Inventories 2,750,000 V 3,030,000 4 U.S. government obligations Tax-exempt securities (see instructions). 5 375,000 375,000 6 0 X 0 x other current assets (attach statement) See St 1. 7 Loans to shareholders Mortgage and real estate loans 8 1 Net Income (oss) per books 852,016 Income recorded on books this year not included on this return (itemize): Tax-exempt interest $ 2 Federal income tax per books 221,734 15,000 3 Excess of capital losses over capital gains Income subject to tax not recorded on books this year (itemize): 15,000 8 Deductions on this return not charged against book income this year (itemize): Depreciation... 136,000 X 5 Expenses recorded on books this year not deducted on this return (itemize): a Depreciation .... b Charitable contributions $ b Charitable contributions ... 15,000 X c Travel & entertainment $ Statement 4 106,000 x 1,000 X 9 Add lines 7 and 8 151,000 x 1,077,750 6 Add lines 1 through 5. 1,228,750 X 10 Income (page 1, line 28) - line 6 less line 9 Schedule M-2 Analysis of Unappropriated Retained Earnings per Books (Line 25, Schedule L) Schedule M-2 Analysis of Unappropriated Retained Earnings per Books (Line 25, Schedule L) 1 Balance at beginning of year. 4,130,000 5 Distributions: a Cash 250,000 b Stock 352,0167 c Property 2 Net income (oss) per books 3 Other increases (itemize) 6 Other decreases (itemize) 7 Add lines 5 and 6 250,000 4 Add lines 1, 2, and 3 4,982,016 8 Balance at end of year (line 4 less line 7) 4,597,727 X Form 1120 (2019) Part II Certain Individuals and Estates Owning the Corporation's Voting Stock. (Form 1120, Schedule K, Question 4b). Complete columns () through (iv) below for any individual or estate that owns directly 20% or more, or owns, directly or indirectly, 50% or more of the total voting power of all classes of the corporation's stock entitled to vote (see instructions). Name of Individual or Estate (H) Identifying Number (HD) Country of (iv) Percentage Owned (if any) Citizenship (see in Voting Stock Instructions) Janet Morton 123-45-6788 United States X Kim Worg 123-45-6787 United States 4a 717,727 x b 5a 5b b 6b 7a 7a 4a Worldwide consolidated net income (less) from income statement source identified in Part 1, line 1.... Indicate accounting standard used for line 4a (see instructions): (1) GAAP (2) IFRS (3) Statutory (4) Tax-Basis (5) Other (specify) 5a Net income from nonincludible foreign entities (attach statement). b Net loss from nonincludible foreign entities (attach statement and enter as a positive amount). Net income from nonincludible U.S. entities (attach statement).. Net loss from nonincludible U.S. entitles (attach statement and enter as a positive amount) Net Income (loss) of other includible foreign disregarded entities (attach statement) Net Income (loss) of other includible U.S. disregarded entities (altach statement) Net Income (loss) of other includible entities (attach statement). B Adjustment to eliminations of transactions between includible entities and nonincludible entities (attach statement) Adjustment to reconcile income statement period to lax year (attach statement) 10 a Intercompany dividend adjustments to reconcile to line 11 (attach statement) b Other statutory accounting adjustments to reconcile to line 11 (attach statement) Other adjustments to reconcile to amount on line 11 (attach statement) 11 Net Income (loss) per income statement or includible corporations. Combine lines 4 through 10... b C 7c 8 9 9 10a 10b 10c 11 717,727 X 12 Enter the total amount (not just the corporation's share) of the assets and liabilities of all entities included or removed on the following lines Total Assets Total Liabilities a included on Part I, line 4. 13,802,727 6,706,000 X Removed on Part 1, line 5. b Removed on Part I, line 6 C d Included on Part 1, line 7 BAA For Paperwork Reduction Act Notice, see the Instructions for Form 1120. Schedule M-3 (Form 1120) 2019 1 2,221,250 x 0 -15,000 -2,236,250 381,000 V 756,023 x -30,000 405,023 X 25 Other income (loss) items with differences (attach statement) 26 Total income (loss) items. Combine lines 1 through 25... 27 Total expense/deduction Items (from Part III line 39) 28 other items with no differences... 29a Mixed groups, see instructions. All others, combine lines 26 through 28 DPC insurance subgroup reconciliation 3,650,000 x 3,650,000 x 717,727 X -30,000 -390,023 X 1,077,750 totals. cure insurance subgroup reconciliation totals 30 Reconciliation totals. Combine lines 290 through 290 717,727 X -30,000 390,023 X 1,077,750 Ann andrum al must equal Form 1120, page 1, line 28. Expense/Deduction Items (a) Expense Per Income Statement (b) Temporary Difference (c) Permanent Difference (d) Deduction per Tax Return 1 U.S. current income tax expense 356,023 x -356,023 X 2 U.S. deferred income tax expense 3 State and local current income tax expense. 4 State and local deferred income tax expense 5 Foreign current Income tax expense (other than foreign withholding taxes) 6 Foreign deferred Income tax expense. 7 Foreion withholding taxes