Renk ta Tax Building & Loan, Inc. is a calendar-year corporation that began business on January 1, 2017. For 2018. it reported the following information in its current year audited income statement. Notes with important tax information are provided below. Book Adjustments (Dr.) CY. Taxable Income Required: Identify the book-to-tax adjustments for Building & Loan a. Reconcile book income to taxable income on worksheet (below). b. Complete Building & Loan's Schedule M-I. c. Complete Building & Loan's Form 1120, page 1 line la to line 31. Income S47,000,000 (34,000,000 Book to Tex Worksheet: Building & Loan Corp. Income statement Por current year Revenue from sales Cost of Goods Sold Gross pront Other Income: Income from investment in IIC stock Interest income Capital gains (losses) Life insurance proceeds Miscellaneous income Gross Income 200,000 20,000 (4,000) 315,00KN 50,000 Notes: 1. Building & Loan owns 10% of the outstanding Home Corp. (HC) stock. Home Corp. reported S2,000,000 of income for the year. Building & Loan accounted for its investment in HC under the equity method and it recorded its pro rata share of HC's carnings for the year. HC also distributed a $100.000 dividend to Building & Loan. 2. Of the $20,000 interest income, $5,000 was from Ford Motor, $7,000 was from a Toyota, $6,000 was from a Town of Bedford Falls municipal bond, and the remaining $2,000 was from an investment in a CD (certificate of deposit). 3. Life insurance proceeds from death of the CFO. 4. This includes total officer compensation of $3,500,000. The CEO was paid $1,250,000 for salary in 2018 (no one officer recelved more than $1,000,000 compensation). 5. $2,000 is the portion of interest paid on a loan taken out to obtain a tax exempt municipal bond from the City of Bedford Falls. 6. Building & Loan actually wrote off $48,000 of its accounts receivable as uncollectible. 7. Tax depreciation was $700,000. 8. In the current year, Building & Loan made $23,500 in actual payments on warranties it provided to customers. 9. Building & Loan made $750,000 of cash contributions to qualified charities during the year. 10. On January 1 of this year Building & Loan acquired the assets of another business. In the process it acquired $200,000 of goodwill. At the end of the year, Building & Loan wrote off $10,000 of the goodwill as impaired. 11. Building & Loan expensed all of its organizational expenditures for book purposes. It expensed the maximum amount of organizational expenditures allowed for tax purposes. 12. The other expenses do not contain any items with book-tax differences. 13. Building & Loan received rental income payments in 2018 that relates to 2019. They have not camed the amount as of year-end and was not recorded in the books. The total amount received was $21,500. Expenses Competisation Interest expense Advertising Repairs and Maintenance Rent (7,500,000 (5,000 (1.350,000) Bad Debt expense Depreciation Warranty expenses Charitable donations Life insurance premiums Meals Goodwill impairment Organizational expenditures Other expenses Total expenses Income before taxes Provision for income taxes Net Income after taxes (75,000) (22,000) (51,000/ (1,000,000) (90,000 (750,000 (45,000) (12,500) W30 (10,000 (59.000, 11 (140.000 ($11.390,000) SXXXXXXX (520,000 $XXXXXX Renk ta Tax Building & Loan, Inc. is a calendar-year corporation that began business on January 1, 2017. For 2018. it reported the following information in its current year audited income statement. Notes with important tax information are provided below. Book Adjustments (Dr.) CY. Taxable Income Required: Identify the book-to-tax adjustments for Building & Loan a. Reconcile book income to taxable income on worksheet (below). b. Complete Building & Loan's Schedule M-I. c. Complete Building & Loan's Form 1120, page 1 line la to line 31. Income S47,000,000 (34,000,000 Book to Tex Worksheet: Building & Loan Corp. Income statement Por current year Revenue from sales Cost of Goods Sold Gross pront Other Income: Income from investment in IIC stock Interest income Capital gains (losses) Life insurance proceeds Miscellaneous income Gross Income 200,000 20,000 (4,000) 315,00KN 50,000 Notes: 1. Building & Loan owns 10% of the outstanding Home Corp. (HC) stock. Home Corp. reported S2,000,000 of income for the year. Building & Loan accounted for its investment in HC under the equity method and it recorded its pro rata share of HC's carnings for the year. HC also distributed a $100.000 dividend to Building & Loan. 2. Of the $20,000 interest income, $5,000 was from Ford Motor, $7,000 was from a Toyota, $6,000 was from a Town of Bedford Falls municipal bond, and the remaining $2,000 was from an investment in a CD (certificate of deposit). 3. Life insurance proceeds from death of the CFO. 4. This includes total officer compensation of $3,500,000. The CEO was paid $1,250,000 for salary in 2018 (no one officer recelved more than $1,000,000 compensation). 5. $2,000 is the portion of interest paid on a loan taken out to obtain a tax exempt municipal bond from the City of Bedford Falls. 6. Building & Loan actually wrote off $48,000 of its accounts receivable as uncollectible. 7. Tax depreciation was $700,000. 8. In the current year, Building & Loan made $23,500 in actual payments on warranties it provided to customers. 9. Building & Loan made $750,000 of cash contributions to qualified charities during the year. 10. On January 1 of this year Building & Loan acquired the assets of another business. In the process it acquired $200,000 of goodwill. At the end of the year, Building & Loan wrote off $10,000 of the goodwill as impaired. 11. Building & Loan expensed all of its organizational expenditures for book purposes. It expensed the maximum amount of organizational expenditures allowed for tax purposes. 12. The other expenses do not contain any items with book-tax differences. 13. Building & Loan received rental income payments in 2018 that relates to 2019. They have not camed the amount as of year-end and was not recorded in the books. The total amount received was $21,500. Expenses Competisation Interest expense Advertising Repairs and Maintenance Rent (7,500,000 (5,000 (1.350,000) Bad Debt expense Depreciation Warranty expenses Charitable donations Life insurance premiums Meals Goodwill impairment Organizational expenditures Other expenses Total expenses Income before taxes Provision for income taxes Net Income after taxes (75,000) (22,000) (51,000/ (1,000,000) (90,000 (750,000 (45,000) (12,500) W30 (10,000 (59.000, 11 (140.000 ($11.390,000) SXXXXXXX (520,000 $XXXXXX