Based upon the following facts about Aqua, Inc., a calendar year S corporation, prepare the entity's Schedule M-2.
AAA, beginning of the year.............................................$ 9,400
Ordinary income............................................................24,600
Tax-exempt income.........................................................3,000
Key employee life insurance proceeds received........................4,900
Payroll penalty expense.....................................................2,200
Charitable contributions....................................................3,000
Unreasonable compensation................................................4,000
Premiums on key employee life insurance...............................2,300
Distribution to shareholders..............................................17,000