In 2019, Nighthawk Corporation, a calendar year C corporation, has $5,080,000 of adjusted taxable income and $152,400 of business interest income. Nighthawk has no floor plan financing interest. The business interest expense for the year is $2,032,000.

a. Assume that Nighthawk has average gross receipts for the prior three-year period of $37,600,000.

Determine Nighthawk's current year deduction for business interest.

b. Assume that Nighthawk has average gross receipts for the prior three-year period of $24,000,000.

Determine Nighthawk's current year deduction for business interest.