Au Sable Corporation Reported Taxable Income of $800,000 in 20X3

question 4

Multiple Choice

Au Sable Corporation reported taxable income of $800,000 in 20X3 and paid federal income taxes of $272,000. Not included in the computation was a disallowed penalty of $25,000, life insurance proceeds of $100,000, and a Federal income tax refund from 20X2 of $50,000. Au Sable is an accrual basis taxpayer. The corporation's current earnings and profits for 20X3 would be:

• A) $875,000.
• B) $653,000.
• C) $603,000.
• D) $553,000.