You are working as a paid tax preparer for a local accounting firm. Your boss has asked you to prepare the 2022 S corporation tax return (Form 1120-S) for Jonesy the perplexed, Inc.

The package given to you by your boss includes the following items: 1. The 2022 Book Income Statement and Book Balance Sheet. 2. Additional Information.

Instructions 1. Prepare Form 1120-S for 2022.

Deliverables 1. 2022 Tax Return: a. Form 1120S pages 1 through 5 (include Schedule M-2 in Form 1120-S (even though the company has never been a C corporation)) This means all pages do not skip the m-1. b. Schedules K-1s. c. Supplemental Statements for Form 1120S. 2. Enter your 4-digit codes (1234) in Paid Preparer's block (PTIN) on page 1 Form 1120S. 3.Use commas to show thousands and millions. Do not use cents in the amounts. If any information is missing, make assumptions and list your caveats in a separate schedule. 4.Schedule M-3 Form 1120S, Form 1125-A, Form 4562, Form 4797 or Schedule D are not needed to be completed.

Jonesy the Perplexed, Inc.
Income Statement
For the Year Ended December 31, 2022
Gross Sales Receipts			$ 5,000,000
Returns and allowances			(100,000)
Net Sales			4,900,000
Beginning Inventory	502,000
Purchases	1,800,000
Labor	600,000
Supplies	80,000
Utilities	100,000
Other Manufacturing Costs	200,000
Goods available for sale	3,282,000
Ending Inventory	(600,000)		2,682,000
Gross Profit			2,218,000
Salaries and Wages	900,000	a
Utilities expense	60,000
Depreciation	25,000	b
Automobile and truck expense	26,000
Office supplies expense	10,000
Advertising Expenses	105,000
Bad debts expense	1,000
Rent Expense	30,000
Interest Expense	18,000	c
Meals and entertainment expense	30,000	g
Selling expense	200,000
Repairs and maintenance expense	40,000
Accounting and legal expense	15,000
Charitable contributions (cash)	10,000
Insurance expense	30,000	d
Hourly employees fringe benefits	11,000
Payroll taxes	150,000
Other taxes	30,000
Penalties (fines)	1,000		(1,692,000)
Operating profit			526,000
Other income and losses:
Long-term gain on sale of capital assets	50,000	e
Sec. 1231 loss	(11,000)	f
Interest on U.S. Treasury bills	1,200
Interest on State of Florida Bonds	600
Qualified Dividends from domestic corporations	24,000		64,800
Net Income			590,800
a - Officer salaries of $200,000 included in the total.
b - The total MACRS depreciation is $60,000. The AMT depreciation adjustment on personal property is $15,000.
c - All interest expense is trade- or business-related. None of the interest expense relates to the production of tax-exempt income.
d - Includes $3,000 of premiums paid for polices on lives of corporate officers. Harvi the Happy Inc. is the beneficiary for both polices.
e - The corporation acquired stocks on March 3, 2018 for $100,000 and sold them on September 15, 2022 for $150,000.
f - The corporation sold a non-depreciable Sec. 1231 property on December 21, 2022 for $10,000. The asset was acquired on June 5, 2018 for $21,000.
g - M&E are 50% deductible for tax
Jonesy the Perplexed, Inc.
Balance Sheet
	1-Jan-22		31-Dec-22
Cash	$ 26,700		$ 117,800
Accounts Receivable	80,500		245,000
Inventories	502,000		600,000
Other Investments	203,000		231,000
Treasury Bills	15,000		160,000
State of Florida bonds	-		10,000
Building & Equipment	674,000		674,000
Accumulated Depreciation	(360,000)		(385,000)
Land	160,000		139,000
Total Assets	1,301,200		1,791,800
Accounts Payable	$ 120,000		$ 110,000
Accrued salaries payable	12,000		16,000
Payroll taxes payable	10,000		20,000
Property taxes payable	5,200		18,000
Due to April Suess	10,000		5,000
Mortgage and notes payable (current maturities)	44,000		52,000
Long-term debt	460,000		440,000
Capital Stock	10,000		10,000
Retained Earnings	630,000		1,120,800
Total Liabilities and Capital	1,301,200		1,791,800
	-		-
Retained Earnings Reconciliation
Beginning Retained Earnings			$ 630,000
Net Income	590,800
Distributions	(100,000)		490,800
Ending Retained Earnings			1,120,800

Additional Information: April Seuss (542-31-6789) and Claire Fead (432-10-5678) are 70% (70 shares) and 30% (30 shares) owners of Jonesy the Perplexed, Inc. (93-1234567) that manufactures ornamental glass bottles. The company is located at 3 Park Lane, Powers, Oregon 97466. April Suess's address is 952 Taylor Ave, Oregon 97623. Claire Fead's address is 1576 SW Maddison Street Portland, Oregon 97201. The company incorporated on January 1, 2018 and made an S election effective on January 1, 2018. The necessary consents to the election were filed in a timely manner. The company's business activity code is 496256. They use the accrual method of accounting. Assume the company doesn't have any additional inventory costs to capitalize underSection 263A. It uses the specific identification method for bad debts for book and tax purposes. As of January 1, 2022, the company had an "Accumulated Adjustments Account" of$518,600. As of January 1, 2022, the company had an "Other Adjustments Account" of $0. Distributions to shareholders were a total of $100,000 from the company. Disregard the section 199A reporting.

USE IRS form 1120-S from 2022. Also use Schedule K from 2022. If possible please upload your answer with the IRS sheets to save yourself time. Remember to fill out all information required on the given sheets. This ranges from A which is s election effective date on page 1, all the way down line 8 on Schedule M-2.