Hornbill Corporation, a cash basis and calendar year C corporation, was formed and began operations on May 1, 2016. Hornbill incurred the following expenses during its first year of operations (May 1 - December 31, 2016): temporary directors meeting expenses of $10,500, state of incorporation fee of $5,000, stock certificate printing expenses of $1,200, and legal fees for drafting corporate charter and bylaws of $7,500. Hornbill Corporation's current year deduction for organizational expenditures is $5,800.

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The total expenses incurred during Hornbill Corporation's first year of operations are $24,200, which includes temporary directors meeting expenses, state of incorporation fee, stock certificate printing expenses, and legal fees for drafting corporate charter and bylaws. However, only $5,800 is deductible in the current year as organizational expenditures.

Hornbill Corporation, a Cash Basis and Calendar Year C Corporation