Question content area top Part 1 A stationery company plans to launch a new type of indelible ink pen. Advertising for the new product will be heavy and will cost the company $10 million, although the company expects general revenues of $280 million next year from sources other than sales of the new pen. If the company has a corporate tax of 40% on its pretax income, what effect will the advertising for the new pen have on its taxes?

A. reduce taxes by $10 million

B. It will have no effect on taxes.

C. increase taxes by $4 million

D. increase taxes by $10 million

E. reduce taxes by $4 million