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Dr. Bruce S corp 2010 - $100,000 Retained earnings 200,000...

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Dr. George Bruce Owns a Laboratory An S Corporation Tax Return Exercise Accountancy 321, Spring 2011 George Bruce is a small business owner who owns 100 percent of a cash basis, calendar year S corporation that operates a medical laboratory. The company’s gross receipts from services for 2010 were $145,000. The corporation also earned interest of $23. Business expenses were as follows: Salaries and wages (not for officers) $ 62,500 Employee benefits 7,073 Rent on premises 18,000 Office expenses including supplies, utilities, and custodial 6.890 Section 179 Expense for new laboratory equipment (Form 4562 is optional)—Book depreciation = $20,400 102,000 Distributions for the year (tax-free) 500 No compensation was paid to dr. Bruce during 2010. The balance sheet of the corporation per books (for Schedule K) follows: Cash $300,000 $ 248,060 Equipment 100,000 202,000 Accumulated depreciation -100,000 -120,400 Capital stock $100,000
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Unformatted text preview: $100,000 Retained earnings 200,000 229,660 For Schedule M-2, the accumulated adjustments account is $200,000 at the beginning of the year. Required (15 points)—Due April 20 (Beginning of Class) Complete the 2010 federal Form 1120 for the corporation and Schedule K-1 for Dr. Bruce (SS# ab1-23-9876). You must provide (make it up) all necessary information that is not given for the company, including its name and address. You may work alone or in a group of up to three. Groups should submit one return with each members name listed at the top of the return. You should be able to complete this in 45 minutes. Note: The only difference between taxable income and book income relates to depreciation ($102,000 - $20,400). Essay (In class)--Parameters: • • 50% of evaluation is based on first impression of content. • 50% of evaluation is based on writing, including persuasion....
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