Question 1 33 pts o Creighton Corp. is a retailer. All of its operations are conducted in the US. It is an accrual method calendar year corporation, which began business in Year 1. For the year ended 12/31/Year 2 (not a typo, Year 2), Creighton reported $7,000,000 EBIT on its financial statements prepared in accordance with GAAP. The corporate records reveal the following information. Creighton's Year 2 book depreciation was $122,000 and its tax depreciation was $150,000. In Year 2, Creighton capitalized $62,000 indirect expenses to manufactured inventory for book purposes and $55,000 indirect expenses to manufactured inventory under the tax uniform capitalization rules. The difference in these amounts was attributable to executive compensation. Due to the increased capitalized executive compensation, Creighton's Year 2 cost of goods sold for book purposes was $1,400,000 and its cost of goods sold for tax purposes was $1,409,000 During Year 2, Creighton sold assets yielding the following gains/losses: 1231 gain of $950,000 Capital losses of $720,000 . 1245 gain of $67,000 In Year 2, Creighton developed a patent with a 17 year-life and incurred research expenditures of $180,000 In Year 2, Creighton's CFO died in a skiing accident. The corporation collected $800,000 in life insurance proceeds. During Year 2, Creighton paid $12,000 premium on the policy. In December Year 2, Creighton settled a lawsuit and agreed to pay $130,000 to a customer for faulty goods. As of year-end, Creighton had not made payment to the customer. In Year 1 (not a typo - Year 1), Creighton deducted $220,000 worth of 1231 losses Creighton does not intend to claim any tax credits for Year 2. Required: Using this template: BT Rec Excel Template.xlsx Provide a Book to Tax Reconciliation computing Creighton's taxable income. Upload your completed template here. o Inload Question 1 33 pts o Creighton Corp. is a retailer. All of its operations are conducted in the US. It is an accrual method calendar year corporation, which began business in Year 1. For the year ended 12/31/Year 2 (not a typo, Year 2), Creighton reported $7,000,000 EBIT on its financial statements prepared in accordance with GAAP. The corporate records reveal the following information. Creighton's Year 2 book depreciation was $122,000 and its tax depreciation was $150,000. In Year 2, Creighton capitalized $62,000 indirect expenses to manufactured inventory for book purposes and $55,000 indirect expenses to manufactured inventory under the tax uniform capitalization rules. The difference in these amounts was attributable to executive compensation. Due to the increased capitalized executive compensation, Creighton's Year 2 cost of goods sold for book purposes was $1,400,000 and its cost of goods sold for tax purposes was $1,409,000 During Year 2, Creighton sold assets yielding the following gains/losses: 1231 gain of $950,000 Capital losses of $720,000 . 1245 gain of $67,000 In Year 2, Creighton developed a patent with a 17 year-life and incurred research expenditures of $180,000 In Year 2, Creighton's CFO died in a skiing accident. The corporation collected $800,000 in life insurance proceeds. During Year 2, Creighton paid $12,000 premium on the policy. In December Year 2, Creighton settled a lawsuit and agreed to pay $130,000 to a customer for faulty goods. As of year-end, Creighton had not made payment to the customer. In Year 1 (not a typo - Year 1), Creighton deducted $220,000 worth of 1231 losses Creighton does not intend to claim any tax credits for Year 2. Required: Using this template: BT Rec Excel Template.xlsx Provide a Book to Tax Reconciliation computing Creighton's taxable income. Upload your completed template here. o Inload