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A. Tax Year 2019 The corporation began operations on January 15, 2019 and during its first taxable year (calendar) obtained the following results under the accumulation method (accrual) ended on December 31, 2019. Assume that all income was collected, and all expenses were paid within the taxable year. Quantity Descripcion Earnings Services Qualified dividends Municipal bond interest $170,000 30,000 10,000 Expenses Administrative Shareholder salary Jennifer Depreciation/amortization Meals and entertainment Charity 175,000 40,000 10,000 6,000 25,000 Additional Information: 1. X-Rays invested $ 50,000 in 2019 to acquire 15% of the common stock of a domestic corporation 2. The $ 25,000 donation was made in cash to a duly qualified non-profit entity 3. No distribution was made to shareholders. 4. Annual depreciation / amortization is distributed to $5,000 the building, $ 3,000 equipment, $ 1,000 program, and $ 1,000 license. Questions: a. Determine the net income (loss) subject to X-Rays tax as of December 31, 2020. b. Compute the corporation's income tax for tax year 2020 C. Compute X-Rays Earnings & Profits Balance as of December 31, 2020. d. Explain whether it is necessary to make any adjustment to the basis of the shares held by the shareholders as a result of the results of operations in 2019

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