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Screen L-2 - Balance Sheet, Page 2 (1120)

Liabilities and Stockholder Equity

For S Corporations, enter the amount of prior C Corporation retained earnings, if applicable. The application includes this amount in calculating Schedule L, Retained earnings, column b.
If you leave this field blank for C Corporations, the application calculates ending Retained earnings - Unappropriated based on the information entered in the Mc Screen and calculated for Schedule M-2.
For S Corporations, if you enter an amount in this field, the application includes the amount in calculating Schedule L, Retained earnings, column d. Leave the
End of Year
 column blank if you want an 1120 S Corporation's Schedule L end-of-year retained earnings to reflect the end-of-year Schedule M-2 balances.
When you leave the fields in the
End of year
 column blank, the application calculates the year-end retained earnings by adding together the year-end Schedule M-2 and Retained Earnings Timing Differences accounts. The Retained Earnings Timing Differences account tracks S Corporation book / tax timing differences. It isn't reflected on Schedule M-2, but it's included in the calculation of the year-end retained earnings. Refer to the Retained Earnings Reconciliation Worksheet for the detail of the Schedule M-s and the Retained Earnings Timing Differences accounts.
If you're preparing Schedule M-1, use the
Ms
 screen to select a code for
Carry book/tax differences to Schedule M-2
 as well as a code in the
Sch M-2
 column of the statement windows for any applicable fields.
If you're preparing Schedule M-3, use the
Book/Tax Differences
 section of the
M3S-2
 screen to select a code in the
Sch M-2
 column of the statement windows for any applicable fields.
Enter an out-of-balance threshold, including zero. The application creates an adjustment to accounts payable or, if there is no balance in accounts payable, it adjusts cash to correct an out-of-balance condition between assets and liabilities.
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