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Luong Corporation, a calendar year, accrual basis corporation, reported $1 million of net income after tax on its financial statements prepared in accordance with GAAP.

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Luong Corporation, a calendar year, accrual basis corporation, reported $1 million of net income after tax on its financial statements prepared in accordance with GAAP. The corporation's books and records reveal the following information: - Luong's federal income tax expense per books was $200,000. - Luong's book income included $10,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock. interest, and $4,000 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest. - Luong recognized $10,000 of capital losses this year and no capital gains. - Luong recorded $8,000 of book expense for meals not provided by a restaurant and $10,000 of book expense for entertainment costs. - Luong's depreciation expense for book purposes totaled $400,000. MACRS depreciation was $475,000. Required: a. Compute Luong's federal taxable income and regular tax liability. b. Prepare a Schedule M-1, page 6. Form 1120, reconciling Luong's book and taxable income. Complete this question by entering your answers in the tabs below. Compute Luong's federal taxable income and regular tax llability. Note: Enter your answers in whole dollars not in millions. Required: a. Compute Luong's federal taxable income and regular tax liability. b. Prepare a Schedule M-1, page 6 , Form 1120 , reconciling Luong's book and taxable income. Complete this question by entering your answers in the tabs below. Prepare a Schedule M-1, page 6, Form 1120, reconciling Luong's book and taxable income. Note: Any Expenses (Line 5) and Deductions (Line 8) that are not included under Depreciation, Charitable Contributions, and Travel and Entertainment should be combined in the corresponding line item "Other". Enter all amounts as positive. Enter your answers in whole dollars not in millions

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