The Following Information Applies to the Operations of MK Inc

The following information applies to the operations of MK Inc. for 2018 and 2019. Assume a tax rate of 30% for both years.
2018 information:
Sales on account in the amount of $650,000
Warranty expense and associated liability in the amount of $105,000
No other expenses incurred.

2019 information:
Sales on account in the amount of $225,000
Warranty repairs made in the amount of $68,000
No expenses incurred.

What is MK's taxable income for 2018?

A) $545,000
B) $650,000
C) $755,000
D) $582,000