Problem 06-17 (Algo) [LO 6-7, 6-9] EFG, an accrual basis, calendar year corporation, reported $715,000 net income before tax on its financial statements prepared in accordance with GAAP. EFG's records reveal the following information: - The allowance for bad debts as of January 1 was $80,000. Write-offs for the year totaled $21,250, and the addition to thie allowance for the year was $19,700. The allowance as of December 31 was $78,450 - EFG paid a $25,025 fine to the state of Delaware for a violation of state pollution control laws. - EFG was sued by a consumers' group for engaging in false advertising practices. Although EFG's lawyers are convinced that the suit is frivolous, its independent auditors insisted on establishing a $71,500 allowance for contingent legal liability and reporting a $71,500 accrued expense on the income statement. - EFG received a $235,950 advanced payment for 10,000 units of inventory on October 20 , EFG reported the payment as revenue the following February when the units were shipped. Required: Compute EFG's taxable income. Note: Amounts to be deducted should be indicated with a minus sign