Grand River Corporation reported taxable income of $500,000 in 20X3 and paid federal income taxes of $170,000. Not included in the computation was a disallowed meals and entertainment expense of $2,000, tax-exempt income of $1,000, and deferred gain on a current year transaction treated as an installment sale of $25,000. The corporation's current earnings and profits for 20X3 would be:

Respuesta :

Answer:

355,000 net income

Explanation:

500,000 taxable income

-2,000 expenses not included

+1,000 ax-exempt income

+25,000 deferred gain (it wasn't in this year taxable income)

525,000 book income

-170,000 tax expense

355,000 net income

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