Gilmores Marriage Counseling, Inc. (HIM???!!!) reports net income per the books amounting to $44,560,039. The corporation reports the following activity:

Unearned Revenue: $835,700

Life Insurance Proceeds $17,046,120

Depreciation deducted on the tax return: $4,126,450

Depreciation recorded on the books: $3,852,041

Excess Capital Losses: $610,770

Meals/Entertainment Expense Reported on the books: $1,475,000

Meals/Entertainment Expense Reported on the tax return: $0

Tax Exempt Interest: $7,761,000

Charitable Contributions recorded on the books: $380,000

Charitable Contributions deducted on the tax return: $772,000

Bad Debts Expense recorded on the books: $480,372

Bad Debts Expense deducted on the tax return: $365,220

Federal Income Tax Expense: $9,110,000

What is reconciling difference for bad debts expense and where is it recorded on Schedule M1?

$115,152 reported on Line 8

None of these

$480,372 reported on Line 5 and $365,220 reported on line 8

$115,152 reported on Line 5