Please help with this Accounting Question. It is a bit extensive and requires some Tax Form/ Return Preparation as indicated in the problem- It spans three pages as it includes balance sheets and other company information that takes up some room. I have included the scans of the pages below. The question is from Prentice Hall'sFederal Taxation 2013: Corporations, Partnerships, Estates & Trusts : Question C: 3-66 (Melodic Musical Sales, Inc.) Thank you in advance very much.

AX FORM/RETURN PREPARATION PROBLEMS e gimp/{Mimi Sales, Inc. is located at 5500 Fourth Avenue, City, ST 98765. The cor- po ' 1013' see the calendar year and accrual basis for both book and tax purposes. It is eng' , ' th'sale of musical instruments with an employer identication number (BIN) of XX20__ ,_ ".1 by company incorporated on December 31, 2007, and began business on janua ' , 7 2,008.11Table C:34 contains balance sheet information at january 1, 2011, and Decembcriwt 2 _ . 3gable (3:3 -5 presents an income statement for 2011. These schedules are present?" onlginook basis. Other information follows the tables. 7 TABLE C34 Melodic Musical Sales, lnc.-Book Balance 313% information January 1. 2 pecember 31, 2011 Account Debit Cre'l it ' Credit Cash $ 96,090 Accounts receivable 417,960 Allowance for doubtful accounts $ 20,898 Inventory 2,250,000 3,150,000 Investment in corporate stock 210,000 92,000 Investment in municipal bonds 30,000 30,000 Net current deferred tax asset 11,185 8,262 Cash surrender value of insurance policy 40,000 50,000 Land 390,000 390,000 Buildings 1,200,000 1,200,000 Accumulated depreciationBuildings 50,000 84,000 Equipment 900,000 2,700,000 Accumulated depreciationEquipment 150,000 245,000 Trucks 220,000 220,000 Accumulated depreciationTrucks 66,000 110,000 Accounts payable 300,000 270,000 Notes payable (short-term) 500,000 400,000 Accrued payroll taxes 13,500 16,875 Accrued state income taxes 8,100 13,500 Accrued federal income taxes 113,668 Bonds payable (longterm) 1,800,000 2,500,000 Net noncurrent deferred tax liability 146,737 240,980 Capital stockCommon 900,000 900,000 Retain earningsUnappropriated 1,800,000 3,715,593 Totals $5,765,235 $5,765,235. $8,633,916 $8,633,916 Kan: Printed by Jeremy Jacques aeremy. : . , '-snhu_edu) on 81121201? from 73.61 17.123 authorized to use unLQ/EIZOW. Use beyond the authorized orvalid subscription date represents a copyright Violation. ted by Jeremy Jacques (i , 6 Corporations v Chapter3 V TABLE (:35 Melodic Musical Sales, incBook Income Statement 2011 Sales $ 9,000,000 Returns $225,000) Net sales $ 8,775,000 Beginning inventory $2,250,0 0 Purchases 4,9500 0 Ending inventory (3,150,000) Cost of goods sold (4,050,000) Gross profit 5 4,725,000 Expenses: ' mortization $ 0 @preciation 223,000 30930: 18,720 Gsera 49,500 Net pre um @ff life Ins 40,500 Officer's Corpensaoi) 585,000 Other salaries a, . . 360,000 Utilities 64,800 Advertising 43,200 Legal and accounting fees 45,000 Charitable contributions 27,000 Payroll taxes -' 56,250 interest expense "r? 4%: 189,000 Bad debt expense ii? Wm 39,402 Total expenses ' 375 ' (1,741,372) Gain on sale of equipment *7; 85,000 interest on municipal bonds 4,500 Net gain on stock sates 37,000 Dividend income 10,800 Net income before income taxes w$ 3,120,928 Federal income tax expense gym, 047 ,835) State income tax expense Net income Sig 6(7, 500) Estimated Tax Payments (Form 2220): The corporation deposited estimated tax payments as follows: April 15, 201 1 $107,000 June 15, 2011 216,000 September 15, 2011 257,000 December 15, 2011 257,000 Total 5130.002 Taxable income in 2010 was $1,700,000, and the 2010 tax was $578,000. The corpora- tion earned its 201 1 taxable income evenly throughout the year. Therefore, it does not use the annualization or seasonal methods. Inventory and Cost of Goods Sold (Form 1125 -:A) The corporation uses the periodic inventory method and prices its inventory using the lower of FIFO cost or market. Only beginning Inventory, ending inventory, and purchases should be reected on Form 1125 -A. No other costs or expenses are allocated to cost of goods sold. Note: the corporation is exempt from the uniform capitalization (UNICAP) rules because average gross income for the preous three years was less than $10 million. Line 9 (ab) Check (ii) Not applicable _ ' -ues@snhu. edu) on 8/12/2017 from T (73 (authorise gto use until 91112017. Use beyond the authonzed user en _ or valid subscription date rep copy right violation. The Corporate Income Tax v Corporations 3-67 Compensation of Officers (Form 1125E): gag y (c) (A; (f) Mary Travis XXXXXXXXX 100% 50% $265,000 John Willis XXXXXxxxx 100% 25% 160,000 Chris Parker xxx-xxxxxx 100% 25% 160,000 Total $585,000 Bad Debts: i For tax purposes, the corporation uses the direct writeoff method of deducting bad debts. For book purposes, the corporation uses an allowance for doubtful accounts. During 2011, the corporation charged $3 6,000 to the allowance account, such amount representing actual writeoffs for 2.011. ' Additional Information (Schedule K): 1 b Accrual 8 Do not check box 2 21 451140 9 Fill in the correct amount Retail sales 10 3 Musical instruments 11 Do not check box 01310 12 Not applicable 0 _ 13 No ., csiomit Schedule G 14 No 5 a No? 15a No b No \Jl 3-68 Corporations V Chapter3 /. in service a piece of equipment costing $2.1 million. Assume these two transactions do not qualify as a like-kind exchange under Reg. Sec. 1.1031(k)1(a). The new equipment is Sevenyear property. The corporation made the Sec. 179 expensing election with regard to the new equipment but elected out of bonus depreciation. Where applicable, use published IRS depreciation tables to compute 2011 depreciation (reproduced in Appendix C of this text). Other Information: - The corporation's activities do not qualify for the U.S. production activities deduction. 0 Ignore the AMT and accumulated earnings tax. * The corporation received dividends (see Income Statement in Table 035) from tax- able, domestic corporations, the stock of which Melodic Musical Sales, Inc. owns less than 20%. I ' 0 The corporation paid $90,000 in cash dividends to its shareholders during the year Sand charged the payment directly to retained earnings. ' Lhe state income tax in Table (323-5 is the exact amount of such taxes incurred during Vj'year.' ' V'Ehe cprporation is not entitled any credits. 0 Ignore thefinancial statement impact of any underpayment penalties incurred on the tax return. ' Required: Prepa' at 2011 corporate tax return for MelodicFMusical Sales, Inc. along with any necessary supporting schedules. Optional: Prepare both ScheduleeMS (but omit Schedule B) and Schedule M-l even though the IRS does not requife both _ehedule M1 and Schedule M-3. Note to Instructor: See solution in thee-Instructor's Guide for other optional information to provide to students. =