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Assume that GAR Corporation had sales of $15 million; its cost of goods sold was $9 million; and it incurred operating expenses of $4.5 million

Assume that GAR Corporation had sales of $15 million; its cost of goods sold was $9 million; and it incurred operating expenses of $4.5 million and an additional $300,000 in interest expense. In addition, it received interest income of $300,000 and dividend income of $400,000. Assume that the firm pays income taxes at the rate of 40%. What is GAR's income tax liability?

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