mush fitness inc 1120s form service income 62675 customer re

mush fitness inc. 1120s form service income $62,675, customer refunds ($550), interest income $6,525, qualified dividend income $350, facility rental ($12,000) officer salary ($40,000) oter salaries ($8,000) fitness su[pplies ($750) laundry servies ($1,200) towels ($270) mats ($537), what is the ordinary income (loss) mush fitness should report on line 21 of forme 1120S, what is the income/loss reconciliation amount that should be reported on line 18 of schedule K?, what i the total income reported on form 1120S line 6?,where should interest income be reported on form 1120S?

Solution

Form 1120S (abstract)

Line no

Particulars

Amount ($)

Amount ($)

1a

Gross Receipts

$62,675

1b

Refunds

$550

1c

Balance (1a-1b)

$62,125

2

Cost of Good Sold

$0

3

Gross Profit

$62,125

4

Net Gain Loss from 4797

$0

5

Other Income (Note 1)

$0

6

Total Income (Loss)

$62,125

7

Compensation of Officers

$40,000

8

Other Salaries

$8,000

11

Rents

$12,000

19

Other Deduction (Table 1)

$2,757

20

Total Deduction (line 7-19)

$62,757

21

Ordinary Business Income/(Loss) (6-20)

-$632

Note 1

Interest Income is not considered to be earned in course of normal business hence reported under line number 4 of Schedule K, otherwise to be reported under line no 5

Table 1

Particulars

Amount($)

Fitness Supplies

$750

Laundry Services

$1,200

Towels

$270

Mats

$537

Total

$2,757

Schedule K (Abstract)

Line No

Particulars

Amount ($)

Amount ($)

1

Ordinary Business Income/(Loss)

-$632

4

Interest Income

$6,525

5a

Ordinary Dividend

$0

5b

Qualified Dividend***

$350

18

Reconciliation

$5,893

Line no 5b is only for disclosure and not considered for reconciliation purpose(Line 18) since qualified dividends are considered as passive income

Form 1120S (abstract)
Line no	Particulars	Amount ($)	Amount ($)
1a	Gross Receipts	$62,675
1b	Refunds	$550
1c	Balance (1a-1b)		$62,125
2	Cost of Good Sold		$0
3	Gross Profit		$62,125
4	Net Gain Loss from 4797		$0
5	Other Income (Note 1)		$0
6	Total Income (Loss)		$62,125
7	Compensation of Officers		$40,000
8	Other Salaries		$8,000
11	Rents		$12,000
19	Other Deduction (Table 1)		$2,757
20	Total Deduction (line 7-19)		$62,757
21	Ordinary Business Income/(Loss) (6-20)		-$632
Note 1	Interest Income is not considered to be earned in course of normal business hence reported under line number 4 of Schedule K, otherwise to be reported under line no 5