During the past year, Alcore Enterprises, Inc., had sales of $3 millon, cost of goods sold of $1.8 million, operating expenses of $800,000, and interest expenses of $200,000. Alcore paid preferred stock dividends of $100,000 and common stock dividends of $200,000 during the year. Alcore also retired maturing debt totaling $1.5 million during the year. Using the U.S. federal corporate tax rates shown in Table 2A.1, what was Alcores taxable income and its total tax liability for the year? What are Alcores marginal tax rate?

Table 2A.I 2004 Corporate Tax Rates Tax Calculation Marginal Tax Rate 15% 25% 34% 39%. 34% 35% 38%.. 35% Base Tax(Marginal Tax Rate Taxable Income Up to $50,000 $50,001 $75,000 $75,001 -$100,000 100,001-$335,000 $335,00I $10,000,000 $10,000,001 $15,000,000 $15,000,001-$18,333,333 Over $18,333,333 x Amount over Base 0 + (15% Amount over $0) 7,500 + (25% Amount over $50,000) 13,750 + (34% Amount over $75,000) 22,250 + (39% Amount over $100,000) $ $ 3,900 + (34% Amount over $335,000) $3,400,000 + (35% Amount over $10,000,000) $5,150,000 + (38% Amount over $15,000,000) .. c:.. 35% Taxable Income