Compute MV Corp.s 2019 taxable income given the following information relating to its year 1 activities. Also, compute MVs Schedule M-1 assuming that MVs federal income tax expense for book purposes is $100,000. Use Exhibit 16-6.

• Gross profit from inventory sales of $500,000 (no booktax differences).
• Dividends MV received from 25 percent-owned corporation of $100,000 (assume this is also MVs pro rata share of the distributing corporations earnings).
• Expenses other than DRD, charitable contribution (CC), and net operating loss (NOL), are $350,000 (no booktax differences).
• NOL carryover from 2018 of $10,000.
• Cash charitable contribution of $120,000.

• Compute MV Corp.s 2019 taxable income given the following information relating to its year 1 activities. (Negative amounts should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.)

  Description	Book Income	Book-tax adjustments		Taxable Income
  	(Dr) Cr	(Dr)	Cr	(Dr) Cr
  Gross profit	$500,000			$500,000
  Other income:
  Dividend income	100,000			100,000
  Gross Income	$600,000			$600,000
  Expenses:
  Business expenses other than DRD, CC, and NOL	(350,000)			(350,000)
  Federal income tax expense	(100,000)		100,000	0
  Total expenses before charitable contribution, NOL, and DRD	(450,000)			(350,000)
  Income before charitable contribution, NOL, and DRD	$150,000			$250,000
  NOL carryover from prior year		(10,000)		(10,000)
  Taxable income for charitable contribution limitation purposes (modified taxable income)				$240,000
  Charitable contributions	(120,000)		96,000	(24,000)
  Taxable income before DRD				$216,000
  Dividends received deduction (DRD)		?		?
  Book/Taxable income	$30,000	$(10,000)	$196,000	$216,000