45. LO.3 In the current year, White, Inc., earns $400,000 from operations and receives

$36,000 in dividends and interest on various portfolio investments. White also pays $150,000 to acquire a 20% interest in a passive activity that produces a $200,000 loss.

a. Assuming that White is a personal service corporation, how will these transactions affect its taxable income?

b. Same as (a), except that White is closely held but not a personal service corporation.