**********Please help with Part II (Part I was posted separately)********

Form 1120 Schedules M reconciliation

Part I: M-1 Information for Tango Inc., an accrual basis corporation

Net income per books (after-tax)	$174,100
Federal income tax expense per books	$86,600
Tax-exempt interest income	$4,500
MACRS depreciation**	$7,200
Excess of capital loss over capital gains	$9,400
Nondeductible meals and entertainment	$5,500
Interest on loan to purchase tax-exempt bonds	$1,100

** This is depreciation in excess of straight-line depreciation used for financial statement purposes

Part II: M-2 Information for Bravo Inc., an accrual basis corporation

Net income per books (after-tax)	$386,250
Taxable income	$120,000
Federal income tax per books	$30,050
Cash dividend distributions	$150,000
Unappropriated retained earnings, as of January 1, 2018	$796,010

Requirements:

1. Reconcile book income to taxable income for Tango Inc. and Bravo Inc. Be sure to start with book income, explain and identify all the adjustments necessary to arrive at taxable income.
2. Identify each book-tax difference as either temporary or permanent and explain your determination.
3. Complete Schedule M-1
4. Complete Schedule M-2 for Bravo Inc.