Tammy Adams and Fernando Hernandez each own 50% of Custom Designs, Inc. (CDI). On May 6, 2003, they formed CDI to provide architectural services. CDI’s information is summarized as follows:

CDI’ s business address is 2120 Adobe Drive, Las Cruces, NM 88011; its employer identification number is 11-1111111, and the principal business activity code is 541310.

CDI is a cash method, calendar year taxpayer.

CDI’s financial statement for 2016 is show below:

Income Statement

Income

Professional fees

739,000

Long-term capital gain

5,000

Short-term capital gain

8,000

Long-term capital loss

6,000

Dividends distributed from Gary Inc. (CDI ownership in Gary is 17%)

20,000

Interest income

State bonds $18,000

Corporate bonds 24,000

42,000

Life insurance proceeds on the death of a key employee

500,000

Total income

1,308,000

Expenses

Salaries-officers

Tammy Adams: 190,000

Fernando Hernandez: 190,000

380,000

Salaries -clerical

61,000

Taxes (state, local , and payroll)

55,620

Advertising

17,650

Rental expenses

9,270

Repairs and maintenance

16,340

Interest expenses:

On loan to purchase state bonds

10,500

Depreciation* (depreciation for tax purpose is $42,000)

35,000

Premiums on life insurance for key employees

25,000

Meals and entertainment

9,800

Total expenses

620,180

Net income before taxes

687,820

Tax

233,858

Income after tax

453,962

During 2016, CDI made estimated tax payment of $60,000 each quarter to the IRS. Prepare a Form 1120 page 1 and schedule M-1 on page 5 for CDI for tax year 2016

The starr theater, owned by meg vargo, will begin operations in march. the starr will be unique in that it will show only triple features of sequential theme movies. as of march 1, the ledger of starr showed: cash $3,150, land $22,000, buildings (concession stand, projection room, ticket booth, and screen) $10,000, equipment $10,000, accounts payable $7,300, and owner’s capital $37,850. during the month of march, the following events and transactions occurred. mar. 2 rented the three indiana jones movies to be shown for the first 3 weeks of march. the film rental was $3,600; $1,600 was paid in cash and $2,000 will be paid on march 10.3 ordered the lord of the rings movies to be shown the last 10 days of march. it will cost $200 per night.9 received $4,500 cash from admissions.10 paid balance due on indiana jones movies rental and $2,200 on march 1 accounts payable.11 starr theater contracted with adam ladd to operate the concession stand. ladd is to pay 15% of gross concession receipts, payable monthly, for the rental of the concession stand.12 paid advertising expenses $900.20 received $5,100 cash from customers for admissions.20 received the lord of the rings movies and paid the rental fee of $2,000.31 paid salaries of $2,900.31 received statement from adam ladd showing gross receipts from concessions of $6,000 and the balance due to starr theater of $900 ($6,000 × 15%) for march. ladd paid one-half the balance due and will remit the remainder on april 5.31 received $9,200 cash from customers for admissions.1.) enter the beginning balances in the ledger.2.) journalize the march transactions. starr records admission revenue as service revenue, rental of the concession stand as rent revenue, and film rental expense as rent expense. (credit account titles are automatically indented when the amount is entered. do not indent manually. record journal entries in the order presented in the problem. if no entry is required, select "no entry" for the account titles and enter 0 for the amounts.)3.) post the march journal entries to the ledger. (post entries in the order of journal entries presented in the previous question.)