Response to the following problem:
In 1999, TI Corporation had sales of $2 million, cost of goods sold of $1 million, and depreciation of $500,000. The firm received $300,000 in dividends and $100,000 in interest income, and paid $150,000 in dividends and $200,000 in interest. It bought equipment for $300,000. The firm's tax rate was 30%, and the dividendsreceived deduction was 70%.
a. What was the taxable income of TI Corporation?
b. How much must TI pay in taxes?