1. Action, Inc. is a calendar year, accrual-basis C Corporation. For each independent situation below, calculate the corporation's taxable income (loss) on its Form 1120, U.S. Corporation Income Tax Return. Column A lists preliminary taxable income excluding additional tax return items shown in column B. Enter the taxable income (loss) in the associated cells in column C.

A	B	C
Operating Income (Loss)	Additional Tax Return Item(s)	Form 1120 Taxable Income (Loss)
$200,000	$40,000 of charitable contributions
$150,000 business income (not including dividneds)	$40,000 of dividends received from a 45%-owned domestic corporation
$3,000,000 business income (not including dividends)	$100,000 charitable contribution (not included in operating income), and $50,000 dividends received (not included in operating income) from a 90% owned domestic corporation