Overview
section 1)Using the financial statements from Unit 1, complete the following:
- Perform a horizontal and vertical analysis of the Balance Sheet and the Income Statement for Jim’s Auto Body.
- Analyze the data to glean information regarding the company’s profitability and any areas for improvement.
Download the data needed to complete this assignment.
section 2) Complete the following for this assignment:
- Prepare a 1120 U.S. Corporation Income Tax Return as Jim’s Auto Body, Inc.
Form 1120 Instructions
Form 1120
- Complete the appropriate schedules in the 1120 and Statement 1 – Other Deductions.
- Prepare a 1065 U.S. Return of Partnership as Jim’s Auto Body, LLC.
Form 1065 Instructions
Form 1065
- Complete the appropriate schedules in the 1065, Statement 1 – Other Deductions and the 1065 Schedule K-1 for Jim.
Schedule K-1 Instructions
Schedule K-1
Note: This project is to be completed without the use of tax preparation software. Use of tax preparation software is considered cheating and is grounds for a failing grade.
Additional Information
Jim’s Auto Body (Inc., or LLC) 1122 Sesame Street New York, NY, 10002 EIN 90-1234567 Dated incorporated January 1st, 2010
Jim Jameson
8701 Electric Avenue
New York, NY, 10002SSN: 123-45-6789
- Jim Jameson took on Fred as a partner for the LLC. Fred owns 50% of all profits, losses, and capital. You do not have to complete Part 2 K, L, or M on the 1065 Schedule K-1 (there is not enough information provided).
- $4,500 salary expense is officer’s compensation for the corporation and guaranteed payment to partners for the LLC.
- $55,000 equipment is 7-year property in its 5th year of service and was placed into service in the middle of the year, thus using the half-year convention. Use the correct table from the IRS—Publication 946: How to Depreciate Property—to determine the tax deductible depreciation. Form 4562 is not required.
- Jim made four quarterly estimated tax payments of $800 each over the course of the year.
- In accordance with IRS instructions: "Corporations with total receipts and total assets at the end of the tax year less than $250,000 are not required to complete Schedules L, M-1, and M-2" (Internal Revenue Service, n.d.). This also applies to the LLC.
- For the 1065 Schedule K-1, you will not have enough information to fill out Part 2 K, L, and M.
| Jim's Auto Body | ||
| Revenues: | ||
| Service Revenue | 28,000 | |
| Total Revenue | 28,000 | |
| Expenses: | ||
| Salary Expense | 4,500 | |
| Rent Expense | 1,200 | |
| Utility Expense | 300 | |
| Depreciation Expense | 500 | |
| Insurance Expense | 100 | |
| Supply Expense | 400 | |
7,000 | ||
| Net Income | 21,000 |
Jim's Auto Body | ||
Balance Sheet | ||
As of April 30, 2020 | ||
| Assets | ||
| Cash | 101,800 | |
| Acct Rec'able | 20,000 | |
| PP In | 1,100 | |
| Equipment | 55,000 | |
| Accu. Dep. | 500 | |
| Supplies | 2,600 | |
| Total Assets | 180,000 | |
| Liabilities and Stockholders' Equity | ||
| Liabilities: | ||
| Accounts Payable | 8,000 | |
| Salary Payable | 3,000 | |
| Total Liabilities | 11000.00 | |
| Stockholders' Equity: | ||
| Common Stock | 150,000 | |
| Retained Earnings | 19000 | |
| ______________________________________________ ______________________________________________ | ||
| Total Stockholders' Equity | 169000.00 | |
| Total Liabilities and Stockholders' Equity | 180,000 | |
| ______________________________________________ ______________________________________________ |
Please submit your assignment.
For assistance with your assignment, please use your textbook and all course resources.
References
Internal Revenue Service (IRS). (2021a). Form 1065. https://www.irs.gov/pub/irs-pdf/f1065.pdf
Internal Revenue Service. (2021b). Form 1120. https://www.irs.gov/pub/irs-pdf/f1120.pdf
Internal Revenue Service. (2021c). Schedule K-1 (Form 1065). https://www.irs.gov/pub/irs-pdf/f1065sk1.pdf
Internal Revenue Service. (2021a, February 4). 2020 partner's instructions for Schedule K-1 (Form 1065). https://www.irs.gov/pub/irs-pdf/i1065sk1.pdf
Internal Revenue Service. (2021b, February 5). 2020 instructions for Form 1065. https://www.irs.gov/pub/irs-pdf/i1065.pdf
Internal Revenue Service. (2021c, February 8). 2020 instructions for Form 1120. https://www.irs.gov/pub/irs-pdf/i1120.pdf
secton 3)Weekly tasks or assignments (Individual or Group Projects) will be due by Monday, and late submissions will be assigned a late penalty in accordance with the late penalty policy found in the syllabus. NOTE: All submission posting times are based on midnight Central Time.
Comprehensive Exam
You will complete your comprehensive exam. You can review the FAQ here.
The comprehensive exam is worth 125 points, representing 10% of your grade. You will receive a series of multiple-choice questions and you will have 3 minutes to answer each question. You will need to have computer Internet access, but no additional application plug-ins will be required. The exam works on all Internet browsers. When you receive your results, you will need to upload the copy in your assignment submission file. Please make sure you upload your results by the due date.
Comprehensive Exam
You should have received your exam access key. To access the exam, click here. You will see a list of courses. Please select this course: ACCT460. Once you have selected the course, the exam will open. Once you receive your results through e-mail, please upload your document by clicking "Launch Submission.
Grading for Comprehensive Exam
The comprehensive exam is worth 10% of your total grade. If you do not complete the exam, you will not receive credit.
The grading scale is outlined below:
| Exam Results | Points Earned |
90 - 100 | 125 |
80 - 89.99 | 115 |
70-79.99 | 105 |
60-69.99 | 95 |
Below 59.99 | 85 |
If you have any questions, please contact your professor.
Please submit your assignment.
For assistance with your assignment, please use your textbook and all course resources.
Reference
Peregrine Academic Services. (n.d.). Colorado Technical University. https://micro.peregrineacademics.com/site/coloradotech/login.php
section 4)Using the case study Jim’s Auto Body, prepare an audit program to audit revenue. You will use all of the relevant management assertions as the audit objectives, and you should include the following:
- Management assertions to be addressed (audit objectives)
- Internal control
- Test of controls
- Substantive test of transactions
Part 1
After the audit program has been drafted, identify the type of report that will be produced as a result of the audit of revenue, and develop the audit report.
Part 2
The American Institute of Certified Public Accountants (AICPA) professional standards provide uniform wording and format for the audit report. The audit report should focus on the revenue cycle and Jim’s Auto Body. Write a 1-page audit report for Jim’s Auto Body that includes all seven parts of a standard audit report, as follows:
- Report title
- Audit report address
- Introductory paragraphs
- Scope paragraph
- Opinion paragraph
- Name of the Certified Public Accountant (CPA) firm
- Audit report date