Frank's Music, Inc., 37-1415259, 1706 Lincoln Ave., Normal, IL 61761, a cash basis corporation, needs to file
Question:
Frank's Music, Inc., 37-1415259, 1706 Lincoln Ave., Normal, IL 61761, a cash basis corporation, needs to file a corporate tax return for 2019. Frank's sell musical instruments. Frank's has 25 stockholders. The largest are the president of the company, Frank Holmes (15%) (323-33-4224), his wife Jane (15%) (368-34-4433), daughter Judy (15%) (388-33-2424) and his boy Elroy (15%) (388-39-4224). They all live in Normal. The remaining stockholders are employee, none of the whom own more than 5% of the stock, are officers, or all are unrelated to the Holmes family. None of the stockholders own stock in any other companies.
Frank's Music had the following:
Sales $525,000
Beginning Inventory $ 28,000
Purchases $273,000
Ending inventory $ 42,000
Salaries $143,000
Rent $ 24,000
Utilities $ 11,000
Charitable contribution $ 18,000
Depreciation $ 16,000
Taxes $ 12,000
Salaries included $55,000 paid to Frank. 100% of Franks employment is being the manager of Frank's Music.
The company also received $10,000 in dividends from a variety of investments they have, none of which do they own more than 20% of the company.
Question
Prepare pages 1-4 of the Form 1120, and the supporting schedules necessary for the numbers you have entered. Cost method FIFO inventory is used, and there were no write-downs of Subnormal goods, changes in valuation of beginning and ending inventories, or applications necessary of section 263A rules.
They didn't make any estimated payments during the year. They had a $10,500 refund that carried over from last year.
Business
ISBN: 978-0324829556
10th Edition
Authors: Willian M Pride, Robert J. Hughes, Jack R Kapoor