Purple Rose Corporation reported pretax book income of $500,000.Tax depreciation exceeded book depreciation by $300,000.In addition,the company received $250,000 of tax-exempt life insurance proceeds.The prior year tax return showed taxable income of $100,000.Using a tax rate of 34%,compute Purple Rose's current income tax expense or benefit.

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The Answer of Purple Rose Corporation reported pretax book income of $500,000.Tax depreciation exceeded book depreciation by $300,000.In addition,the company received $250,000 of tax-exempt life insurance proceeds.The prior year tax return showed taxable income of $100,000.Using a tax rate of 34%,compute Purple Rose's current income tax expense or benefit.

Purple Rose Corporation Reported Pretax Book Income of $500,000