Accounting records for Bridgeport Corporation show the following data for 2017.

(a) No deferred tax asset at the beginning of 2017

(b) Deferred tax liability at the beginning of 2017 was $40,000

(c) Rent collected in advance on January 1, 2017, totaled $225,000 for a 3-year period. Of this amount, $150,000 was reported as unearned at December 31, 2017, for book purposes

(d) Depreciation expense on tax return exceeds depreciation expense on income statement by $125,000 in 2017

(e) Product warranties were estimated to be $54,500 in 2017. Actual repair and labor costs related to the warranties in 2017 were $10,800. The remainder is estimated to be paid evenly in 2018 and 2019

(f) Interest revenue on municipal bonds was $50,000

(g) Life insurance expense for CEO was $8,800

(h) Taxable income in 2017 is $1,500,000

(i) Enacted tax rates are 40% for 2016-2017. In 2017, tax rates for 2018 and after are changed to 35%.

Required: 1. What is Bridgeports pretax financial income in 2017? (6 points). Hint: If you have two future taxables (deductibles), combine them to calculate deferred tax liability (deferred tax asset)