To: Sage Lopez, CFO From: Patrick Boone, CEO Date: December 30, 2022 RE: Switch to S Corp. Sage, Soar, Inc., becomes an S corporation on January 1, 2023, so I just wanted to go over a few more things that we didn't get to in our meeting yesterday. Among our items of income, expense, loss, and credit for the current year were reasonable salary expense, a contributio to a qualified tax-exempt organization, interest-related expense, and a net loss on the disposal of property. Keep these ir mind as you begin filling out and filing tax forms. Additionally, remember that our EIN is 59-7891234 and that we, as well as both of our shareholders, operate on a cash basis and calendar year. If you have any additional questions, please do not hesitate to ask me. Sincerely, Patrick I'm just writing to brief you on the important items of Income for the year ended December 31,2023, before we sit down for our meeting on Friday. My team and I have calculated Soar, Inc.'s total income for 2023 to be $200,000. The following are the components of income: My team is currently finishing up the expense report for 2023. I will send that to you as soon as it is completed. Sincerely, Harry Expense Report To: Sage Lopez, CFO From: Harry Armstrong, Accounting Manager Date: January 6, 2024 RE: Expense Report for 2023 Sage, Here is the expense report for 2023. Let me know if you have any questions or concerns. -Sold equipment (bought in 2021 with an adjusted basis of $30,000 ) for $20,000 - Donated cash to charity - Section 179 expense on machinery placed into service during the current tax year -Interest expense on investment debts -Expenses incurred during the ordinary course of business $(10,000) $(5,000) $(30,000) $(6,000) $(10,000) Sincerely, Harry Dear Ms. Bauza, As a courtesy, we provide each of our shareholders with an end of year report concerning their investment holdings in Soar, Inc. Currently, our records indicate that you own a total of 300 shares, which were acquired on February 1, 2018. Furthermore, we have your Social Security Number listed as 123-45-6789. Under your employment, we have you listed as an officer. Finally, we have your phone number listed as (352) 123-4567. If any of this information is incomplete or has changed, please contact us immediately. Happy New Year, Team Soar, Inc. Soar, Inc. 6850 Parish Avenue Gainesville, FL 32608 Dear Mr. Morales, As a courtesy, we provide each of our shareholders with an end of year report concerning their investment holdings in Soar, Inc. Currently, our records indicate that you own a total of 200 shares, which were acquired on February 1, 2018. Furthermore, we have your Social Security Number listed as 987-65-4321. If any of this information is incomplete or has changed, please contact us immediately. Happy New Year, Team Soar, Inc. Soar, Inc. 6850 Parish Avenue Gainesville, FL 32608 EXHIBITS Internal Email Letter to Danny Morales Letter to Diana Bauza Expense Report Income Report Based on the information in the exhibits, complete the IRS Form 1120-S Schedule K-1 for Soar, Inc., shareholder Danny Morales. For each item, enter the appropriate amount in the associated cell. If the amount is zero, enter a zero (0). Round all amounts to the nearest whole number. Indicate losses and deductions by using a leading minus (-) sign. For item 1, enter the amount as a percentage. To: Sage Lopez, CFO From: Patrick Boone, CEO Date: December 30, 2022 RE: Switch to S Corp. Sage, Soar, Inc., becomes an S corporation on January 1, 2023, so I just wanted to go over a few more things that we didn't get to in our meeting yesterday. Among our items of income, expense, loss, and credit for the current year were reasonable salary expense, a contributio to a qualified tax-exempt organization, interest-related expense, and a net loss on the disposal of property. Keep these ir mind as you begin filling out and filing tax forms. Additionally, remember that our EIN is 59-7891234 and that we, as well as both of our shareholders, operate on a cash basis and calendar year. If you have any additional questions, please do not hesitate to ask me. Sincerely, Patrick I'm just writing to brief you on the important items of Income for the year ended December 31,2023, before we sit down for our meeting on Friday. My team and I have calculated Soar, Inc.'s total income for 2023 to be $200,000. The following are the components of income: My team is currently finishing up the expense report for 2023. I will send that to you as soon as it is completed. Sincerely, Harry Expense Report To: Sage Lopez, CFO From: Harry Armstrong, Accounting Manager Date: January 6, 2024 RE: Expense Report for 2023 Sage, Here is the expense report for 2023. Let me know if you have any questions or concerns. -Sold equipment (bought in 2021 with an adjusted basis of $30,000 ) for $20,000 - Donated cash to charity - Section 179 expense on machinery placed into service during the current tax year -Interest expense on investment debts -Expenses incurred during the ordinary course of business $(10,000) $(5,000) $(30,000) $(6,000) $(10,000) Sincerely, Harry Dear Ms. Bauza, As a courtesy, we provide each of our shareholders with an end of year report concerning their investment holdings in Soar, Inc. Currently, our records indicate that you own a total of 300 shares, which were acquired on February 1, 2018. Furthermore, we have your Social Security Number listed as 123-45-6789. Under your employment, we have you listed as an officer. Finally, we have your phone number listed as (352) 123-4567. If any of this information is incomplete or has changed, please contact us immediately. Happy New Year, Team Soar, Inc. Soar, Inc. 6850 Parish Avenue Gainesville, FL 32608 Dear Mr. Morales, As a courtesy, we provide each of our shareholders with an end of year report concerning their investment holdings in Soar, Inc. Currently, our records indicate that you own a total of 200 shares, which were acquired on February 1, 2018. Furthermore, we have your Social Security Number listed as 987-65-4321. If any of this information is incomplete or has changed, please contact us immediately. Happy New Year, Team Soar, Inc. Soar, Inc. 6850 Parish Avenue Gainesville, FL 32608 EXHIBITS Internal Email Letter to Danny Morales Letter to Diana Bauza Expense Report Income Report Based on the information in the exhibits, complete the IRS Form 1120-S Schedule K-1 for Soar, Inc., shareholder Danny Morales. For each item, enter the appropriate amount in the associated cell. If the amount is zero, enter a zero (0). Round all amounts to the nearest whole number. Indicate losses and deductions by using a leading minus (-) sign. For item 1, enter the amount as a percentage