WHERE EVER THERE IS A RED "X", I NEED HELP PLEASE!!

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 petkingdom@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 $3,250,000 Gross profit Dividends received from stock investments in less-than-20%- owned U.S. corporations 43,750 Interest income: State bonds $15,000 20,000 Certificates of deposit 35,000 $3,328,750 Total income Expenses Salaries-officers: Janet Morton $262,500 262,500 Kim Wong Salaries-clerical and sales Taxes (state, local, and payroll) Repairs and maintenance Interest expense: Loan to purchase state bonds Other business loans $525,000 725,000 238,000 140,000 $9,000 207,000 Advertising Rental expense Depreciation* Charitable contributions Employee benefit programs 216,000 58,000 109,000 106,000 38,000 60,000 40,000 Premiums on term life insurance policies on lives of Janet Morton and Kim Wong; Pet Kingdom is the designated beneficiary Total expenses Net income before taxes Federal income tax Net income per books (2,255,000) $1,073,750 (221,734) $852,016 * Depreciation for tax purposes is $136,000. You are not provided enough detailed data to complete a Form 4562 (depreciation). If you solve this problem using Intuit ProConnect, enter the amount of depreciation on line 20 of Form 1120. Assets Cash Trade notes and accounts receivable Inventories Stock investment State bonds Certificates of deposit Prepaid Federal tax Buildings and other depreciable assets Balance Sheet January 1, 2019 $1,200,000 2,062,500 2,750,000 1,125,000 375,000 400,000 -0- 5,455,000 December 31, 2019 $1,039,461 2,147,000 3,030,000 1,125,000 375,000 400,000 2,266 5,455,000 Accumulated depreciation Land (606,000) 812,500 140,000 $13,714,000 (712,000) 812,500 128,500 $13,802,727 Other assets Total assets Liabilities 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: During 2019, Pet Kingdom made estimated tax payments of $56,000 each quarter to the IRS. Prepare a Form 1120 for Pet Kingdom for tax year 2019. If an amount box does not require an entry or the answer is zero, enter "0". Enter all amounts as positive numbers, unless otherwise instructed. If required, round amounts to the nearest dollar. Make realistic assumptions about any missing data. Complete Form 1120, pages 1, 2 and 3 for Pet Kingdom. OMB No. 1545-0123 Form 1120 Department of the Treasury Internal Revenue Service U.S. Corporation Income Tax Return For calendar year 2019 or tax year beginning -----, 2019, ending ---- 20 Go to www.irs.gov/Form1120 for instructions and the latest information. 2019 A Check if: la Consolidated return (attach Form 851).. B Employer identification number 11-1111112 C Date incorporated b Lifeonlife consolidated return .. 0 TYPE Pet Kingdom, Inc. OR 1010 Northwest Parkway PRINT Dallas, TX 75225 2 Personal holding co. (attach Sch. PH) .... 11/01/2008 D Total assets (see instructions) 3 Personal service corp. (see instructions)... $ 13,802,727 4 Schedule M-3 attached XE Check if: (1) Initial return (2) Final return (3) Name change (4) Address change la Gross receipts or sales la 5,750,000 b Returns and allowances. 1b 200,000 Balance. Subtract line 1b from line 1a 1c 5,550,000 2 Cost of goods sold (attach Form 1125-A). 2 2,300,000 3 Gross profit. Subtract line 2 from line 1c .. 3 3,250,000 4 Dividends and inclusions (Schedule C, line 23, column (a)). 4 43,750 ZOOEW M 5 Interest 5 0 X 6 Gross rents 6 c Add lines 29a and 29b 29c 21,875 30 Taxable income. Subtract line 29c from line 28. See instructions 30 1,055,875 31 Total tax (Schedule ), Part I, line 11)...... 31 0 X 32 2019 net 965 tax liability paid (Schedule ), Part II, line 12). 32 ex www.szocow UWO-u zo 2-0 33 Total payments, credits, and section 965 net tax liability (Schedule ), Part III, line 23) 33 0 34 Estimated tax penalty. See instructions. Check if Form 2220 is attached 34 35 Amount owed. If line 33 is smaller than the total of lines 31, 32, and 34, enter amount owed 35 36 Overpayment. If line 33 is larger than the total of lines 31, 32, and 34, enter amount overpaid ... 36 0 x 37 Enter amount from line 36 you want: Credited to 2020 estimated tax Refunded 37 0 Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge. Sign 11-1111112 Page 3 Form 1120 (2019) Pet Kingdom, Inc. Schedule ) Tax Computation and Payment (see instructions) Part I - Tax Computation 1 Check if the corporation is a member of a controlled group (attach Schedule O (Form 1120)). See instructions .. 2 Income tax. See instructions 2 0 x 3 Base erosion minimum tax (attach Form 8991) 3 4 Add lines 2 and 3 4 0 X 5a Foreign tax credit (attach Form 1118) 5a b Credit from Form 8834 (see instructions) 5b c General business credit (attach Form 3800).. 5c d Credit for prior year minimum tax (attach Form 8827) 5d e Bond credits from Form 8912... 5e 6 Total credits. Add lines 5a through 5e 6 7 Subtract line 6 from line 4 7 0 X 8 Personal holding company tax (attach Schedule PH (Form 1120)). 8 Part III - Payments and Refundable Credits, and Section 965 Net Tax Liability 13 2018 overpayment credited to 2019. 13 14 2019 estimated tax payments 14 0 X 15 2019 refund applied for on Form 4466 15 16 Combine lines 13, 14, and 15 16 0 x 17 Tax deposited with Form 7004 17 18 Withholding (see instructions) 18 19 Total payments. Add lines 16, 17, and 18 19 0 20 Refundable credits from: a Form 2439 20a b Form 4136. 20b c Form 8827, line 5c 200 d Other (attach statement see instructions) 200 21 22 21 Total credits. Add lines 20a through 20d 22 2019 net 965 tax liability from Form 965-B, Part I, column (d), line 3. See instructions. 23 Total payments, credits, and section 965 net tax liability. Add lines 19, 21, and 22. Enter here and on page 1, line 33. 23 0 Form 1120 (2019) 7 At any time during the tax year, did one foreign person own, directly or indirectly, at least 25% of the total voting power of all classes of the corporation's stock entitled to vote or at least 25% of the total value of all classes of the corporation's stock? ..... For rules of attribution, see section 318. If "Yes," enter: (a) Percentage owned and (b) Owner's country 8 (c) The corporation may have to file Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business. Enter the number of Forms 5472 attached Check this box if the corporation issued publicly offered debt instruments with original issue discount. If checked, the corporation may have to file Form 8281, Information Return for Publicly Offered Original Issue Discount Instruments. 9 Enter the amount of tax-exempt interest received or accrued during the tax year $ 10 Enter the number of shareholders at the end of the tax year (if 100 or fewer) 0 x If the corporation has an NOL for the tax year and is electing to forego the carryback period, check here (see instructions) 11 If the corporation is filing a consolidated return, the statement required by Regulations section 1.1502-21(b)(3) must be attached or the election will not be valid. 12 Enter the available NOL carryover from prior tax years (do not reduce it by any deduction reported on page 1, line 29a.) $ Form 1120 (2019) Schedule M-1 Reconciliation of Income (Loss) per Books With Income per Return Note: The corporation may be required to file Schedule M-3. See instructions. Net income (loss) per books 1 0 X 7 Income recorded on books this year not included on this return itemize): 2 Federal income tax per books .. o x Tax-exempt interest $ 0 x 3 Excess of capital losses over capital gains 4 Income subject to tax not recorded on books this year (itemize): 0 X 8 Deductions on this return not charged against book income this year (itemize): 5 Expenses recorded on books this year not deducted on this return (itemize): a Depreciation ...... 0 a Depreciation ...... $ b Charitable contributions. $ b Charitable contributions $ c Travel & entertainment $ 0 X Statement 4 0 X 9 Add lines 7 and 8 0 X 0 10 Income (page 1, line 28) - line 6 less line 9 0 x 6 Add lines 1 through 5 0 X Schedule M-2 Analysis of Unappropriated Retained Earnings per Books (Line 25, Schedule L) 1 Balance at beginning of year .. 0 5 Distributions: a Cash .. 0 b Stock. 2 Net income (loss) per books 0 X c Property 3 Other increases (itemize): 6 Other decreases (itemize):_ 7 Add lines 5 and 6 0 x 4 Add lines 1, 2, and 3 0 X 8 Balance at end of year (line 4 less line 7) 0 Form 1120 (2019) Yes. No. If "No," go to line 4a. Enter the symbol of the corporation's primary U.S. publicly traded voting common stock Enter the nine-digit CUSIP number of the corporation's primary publicly traded voting common stock 4a Worldwide consolidated net income (loss) from income statement source identified in Part I, line 1.... 4a 0 x b Indicate accounting standard used for line 4a (see instructions): (1) GAAP (2) IFRS (3) Statutory (4) Tax-Basis (5) Other (specify) Net income from nonincludible foreign entities (attach statement) Net loss from nonincludible foreign entities (attach statement and enter as a positive amount) 5a 5a ( ) b 5b 11 Net income (loss) per income statement of includible corporations. Combine lines 4 through 10... 11 0 12 Note: Part I, line 11, must equal Part II, line 30, column (a), or Schedule M-1, line 1 (see instructions). 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 0 0 Removed on Part I, line 5 b Removed on Part I, line 6 d Included on Part I, line 7 BAA For Paperwork Reduction Act Notice, see the Instructions for Form 1120. Schedule M-3 (Form 1120) 2019 7 U.S. dividends not eliminated in tax consolidation .. 0 8 Minority interest for includible corporations 9 Income (loss) from U.S. partnerships Income (loss) from foreign partnerships .. 10 11 Income (loss) from other pass-through entities .............. 12 Items relating to reportable transactions. 13 Interest income (see instructions) .. 0 X 0 X 0 X 14 Total accrual to cash adjustment .. 15 Hedging transactions ... Mark-to-market income (loss).... 16 17 Cost of goods sold (see instructions) 2,300,000 2,300,000 0 0 0 0 x 26 Total income (loss) items. Combine lines 1 through 25..... 27 Total expense/deduction items (from Part III, line 39)......... 0 X 0x C 0 X 0 X 28 Other items with no differences ... 0 X 0 29a Mixed groups, see instructions. All others, combine lines 26 through 28. 0 X 0 0 b PC insurance subgroup reconciliation totals c Life insurance subgroup reconciliation totals .. 30 Reconciliation totals. Combine lines 29a 0 X through 29c ......... 0 X 0 x Note: Line 30, column (a), must equal Part I, line 11, and column (d) must equal Form 1120, page 1, line 28. Schedule M-3 (Form 1120) (Rev. 12-2019) Part III Reconciliation of Net Income (Loss) per Income Statement of Includible Corporations With Taxable Income per Return-Expense/Deduction Items (see instructions) 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 0 X 0 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 Foreign withholding taxes . . 8 Interest expense (see instructions) 0 X 9 Stock option expense 10 Other equity-based compensation. 0 X 19 Charitable contribution of cash and tangible property...... 20 Charitable contribution of intangible property... 21 Charitable contribution limitation/carryforward .. 22 Domestic production activities deduction (see instructions) ..... 23 Current year acquisition or reorganization investment banking fees 24 Current year acquisition or reorganization legal and accounting fees .. 25 Current year acquisition/reorganization other costs 26 Amortization/impairment of goodwill... 27 Amortization of acquisition, reorganization, and start-up costs. 28 Other amortization or impairment write-offs 29 Reserved. 30 Depletion 31 Depreciation 0 X 0 136,000 32 Bad debt expense 33 Corporate owned life insurance premiums ..... 34 Purchase versus lease (for purchasers and/or 39 Total expense/deduction items. Combine lines 1 through 38. Enter here and on Part II, line 27, reporting positive amounts as negative and negative amounts as positive ... 0 X 0 x 0 X 0 Schedule M-3 (Form 1120) (Rev. 12-2019) Statement 4 Form 1120, Schedule M-1, Line 5 Book Expenses Not Deducted Officer Life Insurance Premiums 0 State Bond Interest Expense .. 0 x Total 0 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 petkingdom@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 $3,250,000 Gross profit Dividends received from stock investments in less-than-20%- owned U.S. corporations 43,750 Interest income: State bonds $15,000 20,000 Certificates of deposit 35,000 $3,328,750 Total income Expenses Salaries-officers: Janet Morton $262,500 262,500 Kim Wong Salaries-clerical and sales Taxes (state, local, and payroll) Repairs and maintenance Interest expense: Loan to purchase state bonds Other business loans $525,000 725,000 238,000 140,000 $9,000 207,000 Advertising Rental expense Depreciation* Charitable contributions Employee benefit programs 216,000 58,000 109,000 106,000 38,000 60,000 40,000 Premiums on term life insurance policies on lives of Janet Morton and Kim Wong; Pet Kingdom is the designated beneficiary Total expenses Net income before taxes Federal income tax Net income per books (2,255,000) $1,073,750 (221,734) $852,016 * Depreciation for tax purposes is $136,000. You are not provided enough detailed data to complete a Form 4562 (depreciation). If you solve this problem using Intuit ProConnect, enter the amount of depreciation on line 20 of Form 1120. Assets Cash Trade notes and accounts receivable Inventories Stock investment State bonds Certificates of deposit Prepaid Federal tax Buildings and other depreciable assets Balance Sheet January 1, 2019 $1,200,000 2,062,500 2,750,000 1,125,000 375,000 400,000 -0- 5,455,000 December 31, 2019 $1,039,461 2,147,000 3,030,000 1,125,000 375,000 400,000 2,266 5,455,000 Accumulated depreciation Land (606,000) 812,500 140,000 $13,714,000 (712,000) 812,500 128,500 $13,802,727 Other assets Total assets Liabilities 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: During 2019, Pet Kingdom made estimated tax payments of $56,000 each quarter to the IRS. Prepare a Form 1120 for Pet Kingdom for tax year 2019. If an amount box does not require an entry or the answer is zero, enter "0". Enter all amounts as positive numbers, unless otherwise instructed. If required, round amounts to the nearest dollar. Make realistic assumptions about any missing data. Complete Form 1120, pages 1, 2 and 3 for Pet Kingdom. OMB No. 1545-0123 Form 1120 Department of the Treasury Internal Revenue Service U.S. Corporation Income Tax Return For calendar year 2019 or tax year beginning -----, 2019, ending ---- 20 Go to www.irs.gov/Form1120 for instructions and the latest information. 2019 A Check if: la Consolidated return (attach Form 851).. B Employer identification number 11-1111112 C Date incorporated b Lifeonlife consolidated return .. 0 TYPE Pet Kingdom, Inc. OR 1010 Northwest Parkway PRINT Dallas, TX 75225 2 Personal holding co. (attach Sch. PH) .... 11/01/2008 D Total assets (see instructions) 3 Personal service corp. (see instructions)... $ 13,802,727 4 Schedule M-3 attached XE Check if: (1) Initial return (2) Final return (3) Name change (4) Address change la Gross receipts or sales la 5,750,000 b Returns and allowances. 1b 200,000 Balance. Subtract line 1b from line 1a 1c 5,550,000 2 Cost of goods sold (attach Form 1125-A). 2 2,300,000 3 Gross profit. Subtract line 2 from line 1c .. 3 3,250,000 4 Dividends and inclusions (Schedule C, line 23, column (a)). 4 43,750 ZOOEW M 5 Interest 5 0 X 6 Gross rents 6 c Add lines 29a and 29b 29c 21,875 30 Taxable income. Subtract line 29c from line 28. See instructions 30 1,055,875 31 Total tax (Schedule ), Part I, line 11)...... 31 0 X 32 2019 net 965 tax liability paid (Schedule ), Part II, line 12). 32 ex www.szocow UWO-u zo 2-0 33 Total payments, credits, and section 965 net tax liability (Schedule ), Part III, line 23) 33 0 34 Estimated tax penalty. See instructions. Check if Form 2220 is attached 34 35 Amount owed. If line 33 is smaller than the total of lines 31, 32, and 34, enter amount owed 35 36 Overpayment. If line 33 is larger than the total of lines 31, 32, and 34, enter amount overpaid ... 36 0 x 37 Enter amount from line 36 you want: Credited to 2020 estimated tax Refunded 37 0 Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge. Sign 11-1111112 Page 3 Form 1120 (2019) Pet Kingdom, Inc. Schedule ) Tax Computation and Payment (see instructions) Part I - Tax Computation 1 Check if the corporation is a member of a controlled group (attach Schedule O (Form 1120)). See instructions .. 2 Income tax. See instructions 2 0 x 3 Base erosion minimum tax (attach Form 8991) 3 4 Add lines 2 and 3 4 0 X 5a Foreign tax credit (attach Form 1118) 5a b Credit from Form 8834 (see instructions) 5b c General business credit (attach Form 3800).. 5c d Credit for prior year minimum tax (attach Form 8827) 5d e Bond credits from Form 8912... 5e 6 Total credits. Add lines 5a through 5e 6 7 Subtract line 6 from line 4 7 0 X 8 Personal holding company tax (attach Schedule PH (Form 1120)). 8 Part III - Payments and Refundable Credits, and Section 965 Net Tax Liability 13 2018 overpayment credited to 2019. 13 14 2019 estimated tax payments 14 0 X 15 2019 refund applied for on Form 4466 15 16 Combine lines 13, 14, and 15 16 0 x 17 Tax deposited with Form 7004 17 18 Withholding (see instructions) 18 19 Total payments. Add lines 16, 17, and 18 19 0 20 Refundable credits from: a Form 2439 20a b Form 4136. 20b c Form 8827, line 5c 200 d Other (attach statement see instructions) 200 21 22 21 Total credits. Add lines 20a through 20d 22 2019 net 965 tax liability from Form 965-B, Part I, column (d), line 3. See instructions. 23 Total payments, credits, and section 965 net tax liability. Add lines 19, 21, and 22. Enter here and on page 1, line 33. 23 0 Form 1120 (2019) 7 At any time during the tax year, did one foreign person own, directly or indirectly, at least 25% of the total voting power of all classes of the corporation's stock entitled to vote or at least 25% of the total value of all classes of the corporation's stock? ..... For rules of attribution, see section 318. If "Yes," enter: (a) Percentage owned and (b) Owner's country 8 (c) The corporation may have to file Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business. Enter the number of Forms 5472 attached Check this box if the corporation issued publicly offered debt instruments with original issue discount. If checked, the corporation may have to file Form 8281, Information Return for Publicly Offered Original Issue Discount Instruments. 9 Enter the amount of tax-exempt interest received or accrued during the tax year $ 10 Enter the number of shareholders at the end of the tax year (if 100 or fewer) 0 x If the corporation has an NOL for the tax year and is electing to forego the carryback period, check here (see instructions) 11 If the corporation is filing a consolidated return, the statement required by Regulations section 1.1502-21(b)(3) must be attached or the election will not be valid. 12 Enter the available NOL carryover from prior tax years (do not reduce it by any deduction reported on page 1, line 29a.) $ Form 1120 (2019) Schedule M-1 Reconciliation of Income (Loss) per Books With Income per Return Note: The corporation may be required to file Schedule M-3. See instructions. Net income (loss) per books 1 0 X 7 Income recorded on books this year not included on this return itemize): 2 Federal income tax per books .. o x Tax-exempt interest $ 0 x 3 Excess of capital losses over capital gains 4 Income subject to tax not recorded on books this year (itemize): 0 X 8 Deductions on this return not charged against book income this year (itemize): 5 Expenses recorded on books this year not deducted on this return (itemize): a Depreciation ...... 0 a Depreciation ...... $ b Charitable contributions. $ b Charitable contributions $ c Travel & entertainment $ 0 X Statement 4 0 X 9 Add lines 7 and 8 0 X 0 10 Income (page 1, line 28) - line 6 less line 9 0 x 6 Add lines 1 through 5 0 X Schedule M-2 Analysis of Unappropriated Retained Earnings per Books (Line 25, Schedule L) 1 Balance at beginning of year .. 0 5 Distributions: a Cash .. 0 b Stock. 2 Net income (loss) per books 0 X c Property 3 Other increases (itemize): 6 Other decreases (itemize):_ 7 Add lines 5 and 6 0 x 4 Add lines 1, 2, and 3 0 X 8 Balance at end of year (line 4 less line 7) 0 Form 1120 (2019) Yes. No. If "No," go to line 4a. Enter the symbol of the corporation's primary U.S. publicly traded voting common stock Enter the nine-digit CUSIP number of the corporation's primary publicly traded voting common stock 4a Worldwide consolidated net income (loss) from income statement source identified in Part I, line 1.... 4a 0 x b Indicate accounting standard used for line 4a (see instructions): (1) GAAP (2) IFRS (3) Statutory (4) Tax-Basis (5) Other (specify) Net income from nonincludible foreign entities (attach statement) Net loss from nonincludible foreign entities (attach statement and enter as a positive amount) 5a 5a ( ) b 5b 11 Net income (loss) per income statement of includible corporations. Combine lines 4 through 10... 11 0 12 Note: Part I, line 11, must equal Part II, line 30, column (a), or Schedule M-1, line 1 (see instructions). 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 0 0 Removed on Part I, line 5 b Removed on Part I, line 6 d Included on Part I, line 7 BAA For Paperwork Reduction Act Notice, see the Instructions for Form 1120. Schedule M-3 (Form 1120) 2019 7 U.S. dividends not eliminated in tax consolidation .. 0 8 Minority interest for includible corporations 9 Income (loss) from U.S. partnerships Income (loss) from foreign partnerships .. 10 11 Income (loss) from other pass-through entities .............. 12 Items relating to reportable transactions. 13 Interest income (see instructions) .. 0 X 0 X 0 X 14 Total accrual to cash adjustment .. 15 Hedging transactions ... Mark-to-market income (loss).... 16 17 Cost of goods sold (see instructions) 2,300,000 2,300,000 0 0 0 0 x 26 Total income (loss) items. Combine lines 1 through 25..... 27 Total expense/deduction items (from Part III, line 39)......... 0 X 0x C 0 X 0 X 28 Other items with no differences ... 0 X 0 29a Mixed groups, see instructions. All others, combine lines 26 through 28. 0 X 0 0 b PC insurance subgroup reconciliation totals c Life insurance subgroup reconciliation totals .. 30 Reconciliation totals. Combine lines 29a 0 X through 29c ......... 0 X 0 x Note: Line 30, column (a), must equal Part I, line 11, and column (d) must equal Form 1120, page 1, line 28. Schedule M-3 (Form 1120) (Rev. 12-2019) Part III Reconciliation of Net Income (Loss) per Income Statement of Includible Corporations With Taxable Income per Return-Expense/Deduction Items (see instructions) 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 0 X 0 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 Foreign withholding taxes . . 8 Interest expense (see instructions) 0 X 9 Stock option expense 10 Other equity-based compensation. 0 X 19 Charitable contribution of cash and tangible property...... 20 Charitable contribution of intangible property... 21 Charitable contribution limitation/carryforward .. 22 Domestic production activities deduction (see instructions) ..... 23 Current year acquisition or reorganization investment banking fees 24 Current year acquisition or reorganization legal and accounting fees .. 25 Current year acquisition/reorganization other costs 26 Amortization/impairment of goodwill... 27 Amortization of acquisition, reorganization, and start-up costs. 28 Other amortization or impairment write-offs 29 Reserved. 30 Depletion 31 Depreciation 0 X 0 136,000 32 Bad debt expense 33 Corporate owned life insurance premiums ..... 34 Purchase versus lease (for purchasers and/or 39 Total expense/deduction items. Combine lines 1 through 38. Enter here and on Part II, line 27, reporting positive amounts as negative and negative amounts as positive ... 0 X 0 x 0 X 0 Schedule M-3 (Form 1120) (Rev. 12-2019) Statement 4 Form 1120, Schedule M-1, Line 5 Book Expenses Not Deducted Officer Life Insurance Premiums 0 State Bond Interest Expense .. 0 x Total 0