Franton Co., a calendar year, accrual basis corporation, reported $2,076,000 net income after tax on its 2013 financial statements prepared in accordance with GAAP. The corporation's financial records reveal the following information.
• Federal tax expense per books was $1,069,000.
• Franton received $22,400 of dividends from its investment in Microsoft and General Motors stock.
• Bad debt expense was $12,900, and write-offs of uncollectible accounts receivable totaled $16,300.
• Book depreciation was $110,890, and MACRS depreciation was $94,700.
• Franton paid a $50,000 fine to the City of Albany for illegal trash dumping.
Compute Franton's taxable income and regular tax liability.

Question

Quizplus · Accepted Answer

The Answer of Franton Co., a calendar year, accrual basis corporation, reported $2,076,000 net income after tax on its 2013 financial statements prepared in accordance with GAAP. The corporation's financial records reveal the following information.
• Federal tax expense per books was $1,069,000.
• Franton received $22,400 of dividends from its investment in Microsoft and General Motors stock.
• Bad debt expense was $12,900, and write-offs of uncollectible accounts receivable totaled $16,300.
• Book depreciation was $110,890, and MACRS depreciation was $94,700.
• Franton paid a $50,000 fine to the City of Albany for illegal trash dumping.
Compute Franton's taxable income and regular tax liability.