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Book To Tax Reconciliation

Net Income (loss) per Books 131,700


Add:
Gain on Sale of MND Stock 12,000
Organizational Expenses 4,855
Less:
Depreciation (2,500)
Taxable Income 146,055

Gain on Sale of MND Stock


Sale of Stock 38,000
Basis in Stock 8,000
Gain on Sale of Stock 30,000
Gain on Sale of MND Stock Booked 18,000
Tax Adjustment for Gain on Sale of MND Stock 12,000

Organizational Expenditures
Legal Expenses 6,000
Miscellaneous Expenses 100
Total February Expenses 6,100
Less: Expensable Organizational Cost (5,000)
Amortizable February Expenses 1,100
Amortizable Period 180 months
Monthly Deductible Amount 6 per month
Periods in 2012 11
Deductible Amount in 2012 67

Accounting Expenses 4,000


Amortizable May Expenses 4,000
Amortizable Period 180 months
Monthly Deductible Amount 22 per month
Periods in 2012 8
Deductible Amount in 2012 178

One-time Deduction 5,000


Amortized February Expenses 67
Amortized May Expenses 178
Total Organizational Expense Deduction 5,245

Organizational Expense Booked 10,100


Total Organizational Expense Deduction 5,245
Tax adjustment for Organizational Expenses 4,855

Depreciation
Depreciation per books 9,000 (given)
Less:
Depreciation for Tax Purposes (11,500)
Tax Adjustment for Depreciation (2,500)