On February 12, 2004, Nancy Trout and Delores Lake formed Kingfisher Corporation to sell fishing tackle. Pertinent information regarding Kingfisher is summarized as follows.
€¢ Kingfisher's business address is 1717 Main Street, Ely, MN 55731; its telephone number is (218) 555-2211; and its e-mail address is kingfisher@kf.com.
€¢ The employer identification number is 11-1111111, and the principal business activity code is 451110.
€¢ Nancy owns 50% of the common stock and is president of the company, and Delores owns 50% of the common stock and is vice president of the company. No other class of stock is authorized.
€¢ Both Nancy and Delores are full-time employees of Kingfisher. Nancy's Social Security number is 123-45-6789, and Delores's Social Security number is 987-65-4321.
€¢ Kingfisher is an accrual method, calendar year taxpayer. Inventories are determined using FIFO and the lower of cost or market method. Kingfisher uses the straight-line method of deprecation for book purposes and accelerated depreciation (MACRS) for tax purposes.
€¢ During 2015, the corporation distributed cash dividends of $80,000.
Kingfisher's financial statements for 2016

During 2016, Kingfisher made estimated tax payments of $43,750 each quarter to the IRS. Prepare a Form 1120 for Kingfisher for tax year 2016.

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Income Statement Income $2.408,000 Gross sales Sales returns and allowances (80,000) Net sales $2,328,000 Cost of goods sold (920,000) $1408,000 Gross profit Dividends received from stock investments in lessthan-20%-owned U.S. corporations 12,000 Interest income $ 14,000 State bonds Certificates of deposit 10,000 24,000 Total income $1444,000 Expenses Salaries-officers Nancy Trout $160,000 Delores Lake 160,000 $320,000 Salaries-clerical and sales 290,000 Taxes (state, local, and payroll) Repairs and maintenance 85,000 56,000 Interest expense: Business loans $ 12,000 Loan to purchase state bonds 8,000 20,000 Advertising 6,000 Rental expense Depreciation* 68,000 40,000 Charitable contributions 15,000 Employee benefit programs Premiums on term life insurance policies on lives of Nancy Trout and Delores Lake; Kingfisher is the designated beneficiary Total expenses 24,000 16,000 (940,000) Net income before taxes $ 504,000 Federal income tax (171,904) Net income per books $ 332,096