Compute HC Inc.s current-year taxable income given the following information relating to its 2019 activities. Also, compute HCs Schedule M-1 assuming that HCs federal income tax expense for book purposes is $30,000. Use Exhibit 16-6.

• Gross profit from inventory sales of $310,000 (no booktax differences).
• Dividends HC received from 28 percent-owned corporation of $120,000 (this is also HCs pro rata share of the corporations earnings).
• Expenses other than DRD, charitable contribution (CC), and net operating loss (NOL), are $300,000 (no booktax differences).
• NOL carryover from prior year of $12,000.
• Cash charitable contribution of $50,000.