This assignment asks you to fill out 2019 Form 1120 and Schedule C (for dividend received deduction). It is based on the multiple-choice question pasted below. Use the current 21 percent tax rate.

This assignment asks you to fill out 2019 Form 1120 and Schedule C (for dividend received deduction). It is based on the multiple-choice question pasted below. Use the current 21 percent tax rate. [28] In the current year, Acom, Inc., had the following items of income and expense: Sales $500,000 Cost of sales 250,000 Dividends received 25,000 The dividends were received from a corporation of which Acorn owns 30%. In Acorn's current- year income tax retum, what amount should be reported as income before special deductions? A. $525,000 B. $508,750 C. $275,000 D. $250,000 The correct answer is C. A. The amount of $525,000 fails to deduct the cost of sales, B. The amount of $508,750 incorrectly takes the dividends-received deduction, and it fails to deduct cost of sales. C. Income before special deductions accounts for all items except for NOL carrybacks, capital loss carrybacks, and dividends-received deduction. Thus, income before special deductions is $275,000 ($500,000 + $25,000 - $250,000) D. The amount of $250,000 fails to include the dividends received as income