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Cramer Corporation, a calendar year, accrual basis corporation, reported $105 million of net income after tax on its financial statements prepared in accordance with GAAP
Cramer Corporation, a calendar year, accrual basis corporation, reported $105 million of net income after tax on its financial statements prepared in accordance with GAAP The corporation's books and records reveal the following information Cramer's federal income tax expense per books was $201.000. Cramer's book income included $11,000 of dividends received from a domestic corporation in which Cramer owns a 25 percent stock interest and $4.500 of dividends from a domestic corporation in which Cramer owns a 5 percent stock interest Cramer recognized $11,000 of capital losses this year and no capital gains. Cramer recorded 58 600 of book expense for meals not provided by a restaurant and $10.500 of book expense for entertainment Cromer's depreciation expense for book purposes totaled $401000 MACRS depreciation was 5475.000 costs Required: a. Compute Gramer's federal taxable income and regular tax liability b. Prepare a Schedule M-1, page 6. Form 1120, reconciling Cramer's book and taxable income
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