Corporate Corporations earn most of their income from operations; however, they may also receive interest and dividend income. Interest income is taxed as ordinary income; however, dividend income is taxed more favorably. 70% of dividends received is excluded from taxable income, while the remaining 30% is taxed at the ordinary tax rate. For businesses, interest payments are regarded as an expense so they are tax deductible; however, dividend payments are not tax deductible. Consequently, our tax system encourages debt financing over equity financing. Depreciation expense is tax deductible, so the larger the depreciation, the lower the taxable income, the lower the taxes, and the higher the firm's operating cash flow. The projected 2013 tax rate schedule for corporations is shown below. 2013 Corporate Tax Rates It Pays This Plus This Percentage Average Tax If a Corporation's Amount on the on the Excess over the Rate at Taxable Income Is Base of the Bracket Base (Marginal Rate) Top of Bracket Up to $50,000 15.0% 15.0% $50,000 - $75,000 7,500 25.0 18.3 $75,000 - $100,000 13,750 34.0 22.3 $100,000 - $335,000 22,250 39.0 34.0 $335,000 - $10,000,000 113,900 34.0 34.0 $10,000,000 - $15,000,000 3,400,000 34.3 $15,000,000 - $18,333,333 5,150,000 35.0 Over $18,333,333 6,416,667 35.0 35.0 $0 35.0 38.0 Quantitative Problem: Andrews Corporation has income from operations of $244,000. In addition, it received interest income of $24,400 and received dividend income of $30,300 from another corporation. Finally, it paid $12,600 of interest income to its bondholders and paid $45,800 of dividends to its common stockholders. Using the 2013 corporate tax schedule, what is the firm's federal income tax? Round your intermediated and final answers to the nearest cent