Shamberly Corp. is a calendar year, accrual basis corporation that has been in business for 30 years. The following income and expenses appear on Shamberly's records for the year ended December 31, Year 3.

Revenues and Gains
Gross sales	$	1,000,000
Dividends:
10%-owned domestic corporation ABC Corp.		400,000
Interest
California State bonds		15,000
U.S. treasury bonds		35,000
Gain on sale of ABC stock		95,000
Key person life insurance proceeds		300,000
Total	$	1,845,000
Costs and Expenses
Cost of goods sold		650,000
Salaries and wages		420,000
Depreciation		220,000
Meals expense		20,000
Key person life insurance premiums		15,000
State income taxes		10,000
Federal income taxes		45,000
Rent, Utilities, etc.		200,000
Other expenses		50,000
Total		1,630,000
Net Income	$	215 000

1. Calculate Shamberly's taxable income (or net operating loss) for the year. (Amounts to be deducted should be indicated by a minus sign.)

Revenues and Gains	Amount
Gross sales
Dividends: 10%-owned domestic corporation ABC Corp.
Interest on California State bonds
Interest on U.S. treasury bonds
Gain on sale of ABC stock
Key person life insurance proceeds
Total
Costs and Expenses
Cost of goods sold
Salaries and wages
Depreciation
Meals expense
Key person life insurance premiums
State income taxes
Federal income taxes
Rent, Utilities, etc.
Other expenses
Total
Taxable income before DRD
Less: Dividends-received deduction
Taxable income (or Net operating loss)

2. Shamberly Corp is contemplating making a charitable contribution that would be deductible in Year 3. It would like to give the minimum amount necessary to maximize its tax benefit from the contribution deduction for Year 3. First, calculate what that amount would be: (Amounts to be deducted should be indicated by a minus sign.)

Taxable income before charitable contribution
Less: Charitable contribution
Taxable income before DRD
Less: Dividends-received deduction
Taxable income (or Net operating loss)