CORPORATE TAX
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Memo: Whomever
Date: A few minutes ago ¡
From: Maire, Advanced Federal Taxation P.C.
Re: 2007 Tax Return for New Client
I received a call late last night from a prospective new client: Sunset Surfing, Inc. If we impress them ¨C one way or the other -- they likely will tell people about us. They even went out of the way to come by my office very early this morning before a breakfast meeting.
The information they gave me is summarized in Corporations, S Corporation, and Partnerships Practice Sets beginning on page 1. Note that this is the information they gathered for their 2006 tax return, which was filed on time by their last accountant. They have been too busy to get us a copy of the last return.
They gave me this information because they did pretty much the same in 2007 as in 2006. Also, they could give me nothing else -- no previous returns or current information -- because everything was on Jared¡¯s laptop and the hard drive crashed on the flight into L.A. yesterday.
They asked me to prepare 2007 tax return based on the information provided and gave me 20 questions. You are to provide me with the answers to the 20 questions.
They want the answers to the questions as soon as possible.
Prepare the Corporate Return (Form 1120) for Sunset Surfing, Inc. and give the amount for each of the following line items.
1. Gross Profit (line 3) ______________
2. Dividends (line 4) ______________
3. Total Income (line 11) ______________
4. Charitable Contribution (line 19) ___ ____
5. Depreciation (line 20) _$172,204_given___
6. Total Deductions (line 27) _______________
7. Special Deductions (line 29b) ______________
8. Taxable Income (line 30) ______________
9. Total Tax (line 31) ______________
10. Tax due (line 34) ______________
11. Overpayment (line 35) ______________
12. Waterman Compensation Sch. E) ______________
13. Method of Accounting (Sch. K, line 1) ______________
14. Tax Exempt Interest Rec (Sch. K line 9) ______________
15. Total Assets at Yearend (Schedule L) ______________
16. Year end Unappropriated
Retained Earnings (Sch L) ______________
17. Net Income (loss) per books (Sch M-1) ______________
18. Beginning Unappropriated
Retained Earnings (Sch. M-2,line 1) ______________
19. Distributions (Schedule M-2, line 5) ______________
20. Ending Unappropriated
Retained Earnings (Schedule M-2 line 8) _$512,272__given_
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