TarHeel Corporation reported pretax book income of $1,000,000. During the current year, the net reserve for warranties increased by $100,000. In addition, tax depreciation exceeded book depreciation by $200,000. Finally, TarHeel subtracted a dividends received deduction of $50,000 in computing its current-year taxable income. TarHeel's accounting effective tax rate is:

• 17.85 percent.

• 18.9 percent.

• 19.95 percent.

• 21 percent.

Angel Corporation reported pretax book income of $1,030,000. During the current year, the net reserve for warranties increased by $29,500. In addition, tax depreciation exceeded book depreciation by $107,500. Finally, Angel subtracted a dividends received deduction of $31,000 in computing its current-year taxable income. Angel's hypothetical tax expense in its reconciliation of its income tax expense is:

Multiple Choice

• $210,105.

• $193,725.

• $199,920.

• $216,300.