Ramirez Corporation is subject to tax only in State A, and all of its income is allocable or apportionable to State A. Ramirez generated the following income and deductions.

Federal taxable income$500,000

State A income tax expense95,000

Depreciation allowed for Federal tax purposes200,000

Depreciation allowed for state tax purposes250,000

Federal taxable income is the starting point in computing State A taxable income. State income taxes are not deductible for State A tax purposes.

Based on these facts, Ramirez's State A taxable income is:

a.$495,000

b.$500,000

c.$505,000

d.$545,000

e.$595,000