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tax problem-John Martin and Stan Mitchell are 55% and 45% owners of Ram, Inc. a small textile




Question;John Martin (social security number and Stan Mitchell (social security number) are 55% and 45% owners of Ram, Inc. (12-3456785), a small textile manufacturing company located at 1011 Wright Avenue, Kannapolis, NC 28083) The company's first S election was made January 1, 1982. The following information was taken from the income statement for 2008.Other income (active) 380Interest Income (taxable) 267Gross sales 1,376,214Beginning inventory 7,607Direct labor 303,102Direct materials purchased 278,143Direct other costs 149,356Ending inventory 13,467Taxes 39,235Contribution to United fund 445Contribution to Senator BrownsCampaign 5,000Fines on illegal activities 34Life insurance premiums (theCorporation is beneficiary) 98Compensation to shareholderOfficers (proportionate toOwnership) 34,934Salaries and wages 62,103Interest expenses 17,222Repairs 16,106Depreciation 16,154Advertising 3,246Pension plan contributors 6,000Employee benefit programs 2,875Other deductions 63,784Jan 1,2008 Dec 31, 2008Cash 47,840?AR 93,100 153,136Inventories 7,607 13,467Prepaid expenses 10,333 7,582Loans to shareholders 313 727Buildings and trucks 138,203 244,348Accumulated depreciation (84,235)?Land 1,809 16,513Life insurance 11,566 18,344Total assets 226,536 414,970Jan 1,2008 Dec 31,2008AP 52,404 82,963Notes payable (less than 1 year) 5,122 8,989Loans from shareholders 155,751 191,967Notes payable (more than 1 year) 21,821 33,835Loan on life insurance 5,312 16,206Capital stock 1,003 1,003Paid-in capital 9,559 9,559Retained earnings (8,314)?Accumulated adjustments account 0?Other adjustments account 0?Treasury stock (16,122) (16,122)Total liabilities and capital 226,536 414,970Ram's accounting firm provides the following additional information.Distributions to shareholders 290,000AMT depreciation adjustment (1,075)AMT preference, interest on private activity bonds 11,070Using the above information, prepare a complete form 1120S and a Schedule K-1 for John Martin (596 Lane Street, Kannapolis, NC 28083) If any information is missing, make realistic assumptions and list them.find the missing number in the comparative balance sheet.Book federal taxation 2010page E- 13 and 14 (compressive colume)1) find the missing number in the comparative balance sheet.Complete schedule L from page E-13Complete shedule K of form 120S


Paper#42095 | Written in 18-Jul-2015

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