Required:

Prepare the 2016 Schedule M-1 for Form 1120.

Gross Receipts Minus COGS Gross profit from operations Dividends from less than 20% owned corporations Tax Exempt Income Prepaid rental income Minus Operating expenses Depreciation Bad debt expense Business Interest Expense Insurance Premiums on life of key employee (Lamba is the beneficiary NOL disallowed for tax purposes Net Income before special deductions Taxble income before special deductions Additional Information Federal income tax expense per books Book Tax 1,500,000 1,500,000 (550,000) 550,000 950,000 950,000 10000 10,000 0.00 3,000 0.00 8000 300,000) (300,000) 60,000 (170,000) 25,000) 16,000). (75,000) (75,000) (2,800) 0.00 0.00 (12,000) 488,200 407,000 151,640 Difference 0.00 0.00 0.00 0.00 3,000 (8,000) 0.00 110,000 (9,000) (2,800) (12,000)