a. Compute XYZ's taxable income.

b. Compute XYZ's income tax liability.

c. Complete XYZ's Schedule M-1.

I'm posting the correct answers myself because nobody else had the correct ones.

a. 1,860,260

b. 390,655

c.

 

  

 

XYZ is a calendar-year corporation that began business on January 1, 2022. For the year, it reported the following information in its current-year audited income statement. Notes with important tax information are provided below. Use Exhibit 16-6. XYZ corporation Income statement For current year Revenue from sales Cost of Goods Sold Gross profit Other income: Book Income $ 40,000,000 (27,000,000) $13,000,000 Income from investment in corporate stock Interest income Capital gains (losses) Gain or loss from disposition of fixed assets Miscellaneous income Gross Income Compensation Stock option compensation Advertising Repairs and Maintenance Rent Bad Debt expense Depreciation Warranty expenses Charitable donations Expenses: Meals (all from restaurants) Goodwill impairment 300,0001 20,0002 (4,000) 3,000 50,000 $ 13,369,000 (7,500,000) 4 (200,000) 5 (1,350,000) (75,000) (22,000) (41,000) 6 (1,400,000) 7 (70,000) 8 (500,000) (18,000) (30,000) 10