LO.8 Christie is the preparer of the Form 1120 for Yostern Corporation. On the return, Yostern claimed a deduction that the IRS later disallowed on audit. Compute the tax preparer penalty that could be assessed against Christie in each of the following independent situations.

	Form 8275 Disclosure on the Return of the Disputed Deduction?	Tax Reduction Resulting from the Deduction	Probability That the Courts Would Approve the Deduction	Christies Fee to Complete Yosterns Return
a.	No	$40,000	65%	$7,000
b.	No	40,000	35	7,000
c.	No	40,000	35	1,500
d.	Yes	40,000	35	7,000
e.	Yes	40,000	15	4,000