Taxable income is NOT 1,604,400. The answers filled in are correct.

Cramer Corporation, a calendar year, accrual basis corporation, reported $1.45 million of net income after tax on its financial statements prepared in accordance with GAAP. The corporation's books and records reveal the following information: - Cramer's federal income tax expense per books was $209,000. - Cramer's book income included $19,000 of dividends received from a domestic corporation in which Cramer owns a 25 percent stock interest, and $8,500 of dividends from a domestic corporation in which Cramer owns a 5 percent stock interest. - Cramer recognized $19,000 of capital losses this year and no capital gains. - Cramer recorded $12,600 of book expense for meals not provided by a restaurant and $14,500 of book expense for entertainmen costs. - Cramer's depreciation expense for book purposes totaled $409,000. MACRS depreciation was $475,000. Required: a. Compute Cramer's federal taxable income and regular tax liability. b. Prepare a Schedule M-1, page 6, Form 1120, reconciling Cramer's book and taxable income. Complete this question by entering your answers in the tabs below. Prepare a Schedule M-1, page 6, Form 1120, reconciling Cramer's book and taxable income. (Any Expenses (Line 5) and Deductions (Line 8) that "Other". Enter all amounts as positive. Enter your answers in whole dollars not in millions.) Schedule M-1 Reconciliation of Income (Loss) per Books With Income per Return