Question text

Esther Corporation has a tax rate of 20 percent and income before non-operating items of $1,785,000. It also has the following items (gross amounts).

Unusual gain $115,000

Loss from discontinued operations (net of taxes) $915,000

Dividend revenue $30,000

Income increasing prior period adjustment $370,000

What is the amount of income tax expense Esther Corporation would report on its income statement?

Select one:

a. $203,000

b. $363,000

c. $277,000

d. $386,000