XYZ is a calendar-year corporation that began business on January 1, 2020. 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.

KY? corporation Income statement For current year Book Income Revenue from sales 5 40,000,000 Cost of Goods Sold -{Z'.-',000,000} Gross profit 5 13,000,000 Other income: Income from investment in corporate stock 33-09031 Interest income 20,0002 lCapital gains {losses} {4,000} Gain or loss from disposition offixed assets 3,0003 Miscellaneous income 50,000 Gross Income 5 13,359,000 Expenses: Compensation -{?,500,000]4 Stock option compensation {200,000}5 Advertising {1,350,000} Repairs and Maintenance -{?5,000] Rent {2,1300} Bad Debt expense {41,0001'5 Depreciation {1,400,000}? Warranty expenses {T-'0,000]a' Charitable donations {50000039 Meals {all at restaurants} {13,000} Goodwill impairment {30.000110 Organizational expenditures {44,000}]'1 Other expenses {140,000}-_2 Total expenses 5 {11,390,000} Income before taxes 5 1,9?9, 000 Provision for income taxes {400,000}13 Net Income aftertaxes 5 1,5?9, 000