Cramer Corporation, a calendar year, accrual basis corporation, reported $1.25 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 $205,000

Cramer's book income included $15,000 of dividends received from a domestic corporation in which Cramer owns a 25 percent stock interest, and $6,500 of dividends from a domestic corporation in which Cramer owns a 5 percent stock interest

Cramer recognized $15,000 of capital losses this year and no capital gains.

Cramer recorded $10,600 of book expense for meals not provided by a restaurant and $12,500 of book expense for entertainment costs .

Cramer's depreciation expense for book purposes totaled $ 405,000 MACRS depreciation was $475,000

Required

Compute Cramer's federal taxable income and regular tax liability

b. Prepare a Schedule M-1page Form 1120, reconciling Cramer's book and taxable income

Complete this question by entering your answers in the tabs below. Compute Cramer's federal taxable income and regular tax liability. (Enter your answers in whole dollars not in millions.) Prepare a Schedule M-1, page 6, Form 1120, reconciling Cramer's book and taxable incorne. (Any Expenses (Line 5) and Deductions are not included under Depreciation, Charitable Contributions, and Travel and Entertainment should be combined in the correspondir "Other", Enter all amounts as positive, Enter your answers in whole dollars not in millions.) Schedule M.1 Reconciliation of Income (Loss) per Books With Income per Return Cramer Corporation, a calendar year, accrual basis corporation, reported $1.25 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 $205,000 - Cramer's book income included $15,000 of dividends received from a domestic corporation in which Cramer owns a 25 percent stock interest, and $6,500 of dividends from a domestic corporation in which Cramer owns a 5 percent stock interest - Cramer recognized $15,000 of capital losses this year and no capital gains. - Cramer recorded $10,600 of book expense for meals not provided by a restaurant and $12,500 of book expense for entertainment costs - Cramer's depreciation expense for book purposes totaled $405,000. MACRS depreciation was $475,000. Required: 0. Compute Cramer'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