5. A consumer electronics company was formed to sell a portable handset system. The company purchased a warehouse and converted it into a manufacturing plant for $2,500,000 (including the purchase price of the warehouse). It completed installation of assembly equipment worth $650,000 on December 31, 2015. The plant began operation on January 1, 2016. The company had a gross income of $2,700,000 for the calendar year. Manufacturing costs and all operating expenses, excluding the capital expenditures, were $1,800,000. The depreciation expenses for capital expenditures amounted to $500,000. (a) Compute the taxable income of this company. (b) How much will the company pay in federal income taxes for the year? Note: Make sure you use the tax rates for 1994-2017.