Your Corporation Has the Following Cash Flows ?
If the Applicable Income Tax Rate Is 40% (Federal

Your corporation has the following cash flows: $$\begin{array} { l r } \text { Operating income } & \$ 250,000 \\\text { Interest received } & \$ 10,000 \\\text { Interest paid } & \$ 45,000 \\\text { Dividends received } & \$ 17,000 \\\text { Dividends paid } & \$ 50,000\end{array}$$
?
If the applicable income tax rate is 40% (federal and state combined) ,and if 70% of dividends received are exempt from taxes,what is the corporation's tax liability?

A) $87,160
B) $88,040
C) $80,116
D) $108,289
E) $77,475