Form 1120 Omega Beard President of the corporation Income

Form 1120 - Omega Beard - President of the corporation

Income & Expenses are as follows: $87,535 Cash Sales,$1,750 Customer Refunds, $425 Interest Income, $1,575 Royalities - Expenses - $25,000 Officer Compensation, $4,250 book/Tax depreciation, $1,975 Interest expense, $750 Taxes & Licenses, $2,000 Advertising, $4,725 Utilities, $4,290 Packaging..

1. What is the gross sales amount reported on Form 1120, line 1a? A. $85,785, B. $87,535, C. $87,960, D. $89,535

2. What is the taxable income reported on Form 1120, line 30? A. $43,045, B. $44,795, C. $47,295, D. $49,045

3. What is the gross profit for the Beard Corporation? A. $85,785, B. $86,210, C. $87,535, D. $87,785

4. What are the total deductions reported on Form 1120, line 27? A. $40,990, B. $42,740, C. $42,990, D. $44,740

Solution

Answer

1 ) 87535

the gross income from sales should not be included any passive income , refunds, interest incomes

2 ) 44795

taxable income = 25000 + 4250 + 1975 + 750 + 2000 + 4725 + 4290 + 1750

= 44795

3 ) 85785

gross profit = 87535 - 1750

= 85785

4 ) 42990

total deductions = 25000 + 4250 + 1975 + 2000 + 4725 + 750 + 4290

= 42990