Collander Corporation is preparing Schedule M-1 of its Form 1120, U.S. Corporati
ID: 2544271 • Letter: C
Question
Collander Corporation is preparing Schedule M-1 of its Form 1120, U.S. Corporation Income Tax Return. Which of the following statements is false with regard to the preparation of Collander’s Schedule M-1? A. Federal income taxes on book income are added back to net book income to arrive at taxable income. B. The premiums paid on the key employee life insurance policy are a negative adjustment to book income to arrive at taxable income. C. The starting point is net income per books and the ending point is taxable income before the NOL and dividends-received deductions. D. Life insurance proceeds paid on the death of a key employee is a negative adjustment to book income to arrive at taxable income. Collander Corporation is preparing Schedule M-1 of its Form 1120, U.S. Corporation Income Tax Return. Which of the following statements is false with regard to the preparation of Collander’s Schedule M-1? A. Federal income taxes on book income are added back to net book income to arrive at taxable income. B. The premiums paid on the key employee life insurance policy are a negative adjustment to book income to arrive at taxable income. C. The starting point is net income per books and the ending point is taxable income before the NOL and dividends-received deductions. D. Life insurance proceeds paid on the death of a key employee is a negative adjustment to book income to arrive at taxable income.Explanation / Answer
Ans D) Life insurance proceeds paid on the death of a key employee is a negative adjustment to book income to arrive at taxable income.
All other options are correct.