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Corporate Taxation 539

Group Project: U.S Corporate Tax Return

Client: The Bike Shop, Inc.

1234 Wheeling Road
Cincinnati, OH 45202

Step 1: Scope, budget in hours, work plan, & team


The Bike Shop, Inc. jointly owned and operated by Sam Smith and Jane Jones was incorporated
in May 1, 1995. Sam Smith is the President and owns 70% while Jane Jones is secretary
treasurer owns 30%. Both of them are also full time employees.

Scope of Work

Obtain, review and evaluate all information about income and finances of The Bike Shop
Review prior years tax filling and tax liability status of The Bike Shop
Research and properly prepare 2012 tax form 1120 and ensure that tax liability is at its
legal minimum
Prepare computational and other schedules to tax form 1120.
Ensure filing of The Bike Shop 2012 Tax Returns within the stipulated time.

Budget in hours

The budget of the professional service that will be rendered in connection of the preparation of
2013 corporate tax return is detailed in the table below. This budget is a pro forma and the total
billable hours will be adjusted to match the exact billable hours that were used in connection
with the preparation of the client's tax return.


Planned expense
Time (in hours) Description
5.00 Step 1: Scope, workplan
6.00 Step 2: Trial balance with book to tax reconciliation
5.00 Step 3: Tax provision calculation
2.00 Step 4: Draft of corporate tax return
3.00 Step 5: final corporate tax return
4.00 Tax preparers meeting
Work Plan

Assignment goal statement: To increase understanding of U.S. Corporation Income tax Return.

By the end of this assignment, we will be able to prepare Form 1120.

Activity Inputs Timeframe Anticipated

Identify the Scope, Research team 9/3 Complete the first
budget in hours, step
workplan and team of
this assignment
Prepare the tax trial Balance sheet 9/10 Complete schedule L
balance with book to Research team of form 1120
tax adjustment load and reconcile
gather general ledger
data into files
Prepare the Balance sheet, income 9/10 Complete schedule
reconciliation to book statement and M-1 and schedule M-
to taxable income research team 2
load and reconcile
gather general ledger
data into files
Prepare tax provision Research team 9/24 Complete form 1120
calculations, penalties (including schedule L,
and any final schedule M-1,
adjustments schedule M-2, form
4626, form 2220, etc.)
Prepare draft of Research team 10/1 Complete form 1120
corporate tax return with attachments
Meeting with the Research team 10/1 Complete form 1120
client with attachments
Prepare final Research team 10/22 Complete form 1120
corporate tax return, with attachments
with supporting
schedules and

We will try to finish the assignment one week ahead of time, so we can check up our

answers with the professor and see if we would make any adjustments. Also, we will try to read
the book and understand the material during this week to be able to fill up the form and analyze

the data correctly.

Team members

(1) Jacques Djoutsop: (2024466973)

(2) Nurain Yusuf Adewale (3176020301)
(3) Wassim Zhani (8122230024)
(4) Kaleb Lantrip (3176921509)