1. ABC Inc., a cash-method C corporation, had taxable income of $1,000,000 for its initial taxable year (year 1). A review of company records revealed the following information:
   1. ABCs estimated federal income tax payments made during the year totaled $200,000.
   2. The current-year tax depreciation expense on furniture and fixtures, the only asset owned by ABC, was $120,000. If ABC had used the alternative depreciation system (straight-line method), depreciation expense deducted would have been $50,000.
   3. ABC had tax-exempt interest income of $60,000 that was not been included in taxable income.
   4. ABC reported a $75,000 gain on an installment sale of a non-inventory item in taxable income. The total gain on the sale was $225,000.
   5. ABC received a $40,000 dividend from X Corporation, of which ABC owns 25% of the shares. The dividend income and associated dividend received deduction were included in taxable income.

Instructions:

Compute ABC Inc.s current earnings and profits (E&P) at the close of the current year (year 1).