5-27 (10.2) Sparrow Corporation (a calendar yeat, accrual basis taxpayer) had the following transactions in 2021, s second year of operation Taxable income Federal income tax liability $330,000 69,300 Tax-exempt interest income 5,000 Business meals expense (total) Premiums paid on key employee e insurance 3,000 3,300 Increase in h surrender value attributable to Me insuran 700 Proceeds from key employee life insurance policy 130,000 Cash surrender value of life insurance policy at distribution 20,000 Excess of capital losses over capital gain 13.000 MACRS deduction 25,000 16,000 Straight line depreciation using ADS ly Section 179 expense elected in 2000 25,000 Dividends received from domestic corporations Dess than 20% owned) 35,000 Sparrow is the LFD inventory method, and its UFO recapture amount increased by $10,000 during 2021. In addition, Sparrow s property on installment during 2020. The property was sold for $40,000 and had an adjusted basis at sale of $32,000. During 2021, Sparrow received a $15,000 payment on the installment sale. Finally, assume that no additonal first-year depreciation was claimed Click here for the Dividend Received Deduction Table Indicate whether each item (or part of the ite) is "Add" to "Deducted from taxable income, ar effect when computing EAR Federal income tax Batty paid C