During 2016, Thrasher (a calendar year, accrual basis S corporation) has the following transactions: Sales.................................................................................$1,500,000 Cost of

Question:

During 2016, Thrasher (a calendar year, accrual basis S corporation) has the following transactions:

Sales.................................................................................$1,500,000

Cost of goods sold ................................................................900,000

Long-term capital gain ............................................................ 10,000

Short-term capital gain ............................................................ 5,000

Salaries ..............................................................................210,000

Qualified dividends from stock investments .................................. 30,000

Rent expense .......................................................................170,000

Advertising expense ............................................................... 20,000

Interest on City of Trenton bonds ............................................... 15,000

§ 1231 gain ......................................................................... 25,000

Organizational expenditures ...................................................... 3,000

Charitable contributions .......................................................... 5,000

Bad debt (trade account receivable deemed to be uncollectible) ............ 10,000

Cash dividend distributed to shareholders .....................................120,000

a. Determine Thrasher Corporation's separately stated items for 2016.

b. Determine Thrasher's taxable income for 2016.

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...