Kravitz Corporation Kravitz Corporation had income before taxes of $850,000 and a tax rate of 35%. Included in the income are $60,000 in municipal bond interest and $10,000 in fines and penalties. There are no other book-tax differences. Refer to Kravitz Corporation. What is Kravitz' effective income tax rate?

A. 35% B. 32.5% C. 37.5% D. 32.9%