L0 11-3, 11-4 . . 13. Western Corporation, a calendar year, accrual basis corporation, reported $500,000 of net income after tax on its 2018 financial statements prepared in accordance with GAAP. The corporation's books and records reveal the following information: Western's book income included $15,000 of dividends, received from a domestic corporation in which Western owns less than 1 percent of the outstanding stock. Western's depreciation expense per books was $55,000, and its MACRS deprecia- tion was $70,000 Western earned $5,000 of interest from municipal bonds and $6,000 of interest from corporate bonds. Western's capital losses exceeded its capital gains by $2,000. Western's federal income tax expense per books was $ 103,000. a. Compute Western's federal taxable income and regular tax liability. b. Prepare a Schedule M-1, page 5, Form 1120, reconciling Western's book and taxable income