DeWitt Corporation reported pretax book income of $800,000.Tax depreciation exceeded book depreciation by $400,000.In addition,the company received $100,000 of tax-exempt municipal bond interest.DeWitt used a net operating loss carryover of $200,000 to offset taxable income in the current year.Compute DeWitt's book equivalent of taxable income.Use this number to compute DeWitt's total income tax provision or benefit for the current year,assuming a tax rate of 34%.

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The Answer of DeWitt Corporation reported pretax book income of $800,000.Tax depreciation exceeded book depreciation by $400,000.In addition,the company received $100,000 of tax-exempt municipal bond interest.DeWitt used a net operating loss carryover of $200,000 to offset taxable income in the current year.Compute DeWitt's book equivalent of taxable income.Use this number to compute DeWitt's total income tax provision or benefit for the current year,assuming a tax rate of 34%.

DeWitt Corporation Reported Pretax Book Income of $800,000