Income Sales $4,440,000 Cost of goods sold (1,840,000 Gross Profit 2,600,000 Dividends received from stock investments in Less than 20% owned U.S. corporations 35,000 Interest income State bonds $12,000 Corporate bonds 16.000 28,000 Total Income $2,663,000 Expenses Salaries 1,000,000 Taxes (state, local, and payroll) 190,000 Repairs and maintenance 112,000 Net Capital Loss 25,000 Interest expense: Loan to purchase state bonds 7,000 Other business loans 174,000 181,000 Advertising 132,000 Depreciation for book purpose* 80,000 Charitable contributions 100,000 Employee benefit programs (a regular corporate expense) 48,000 Premiums on term life insurance policies on lives of Janet and Kim 32,000 Total expenses (1,900,000 Net income before taxes 763,000 Federal Income tax (282.370 Net income per books 480.630