The following information relates to Interstate Trucking for itsfirst year of operations (data in millions of dollars):
Pretax accounting income: $150
Pretax accounting income included:
Overweight fines (not deductible for tax purposes) 5
Depreciation expense 70
Depreciation on the tax return using MACRS: 110
The applicable tax rate is 40%. There are no other temporary ornontemporary differences.
Interstate's taxable income ($ in millions) is:
Interstate's net income ($ inmillions) is:
1) $88.
2) $99.4.
3) $104.
4) $134.