Pls help with the numbers in red. Also, provide an explanation of your results! Thank you!

Compute HC Inc.'s current-year taxable income given the following information relating to its 2020 activities. Also, compute HC's Schedule M-1 assuming that HC's federal income tax expense for book purposes is $30,000. Use Exhibit 16-6. Gross profit from inventory sales of $310,000 (no book-tax differences) Dividends HC received from 28 percent-owned corporation of $120,000 (this is also HC's pro rata share of the corporation's earnings) Expenses other than DRD, charitable contribution (CC), and net operating loss (NOL) are $300,000 (no book-tax differences). NOL carryover from prior year of $12,000, Cash charitable contribution of $50,000. Assume HC does not elect to use the 25% of modified taxable income limitation to determine its charitable contribution deduction Reg 1 Reg 2 Compute HC Inc.'s current-year taxable income given the following information relating to its 2020 activities. (Negative amounts should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.) Description Book Income (Dr) Cr $ 310,000 Book tax adjustments (Dr) Cr Taxable Income (Dr) Cr 310,000 $ Gross profit Other income: Dividend Income 120,000 $ 430,000 120,000 430,000 $ (300,000) (30,000) (300,000) 0 30,000 (330,000) (300,000) $ 100,000 $ Gross Income Expenses Business expenses other than DRD, CC, and NOL Federal income tax expense Total expenses before charitable contribution NOL, and DRD deduction Income before charitable contribution, NOL and DRD NOL carryover from prior year Taxable income for charitable contribution limitation purposes (modified taxable income) Charitable contributions Taxable income before DRD Dividends received deduction (DRD) Book/Taxable income 130,000 (12.000) O (12,000) IS 118,000 (50,000) 50,000 X $ (120,000) 0 % 118,000 (120,000) 3 (2.000) $ 50,000 $ 80,000 IS (132,000) Req2 >