10 free CPA practice questions in the real exam format, covering the official content areas, with an explanation for every answer.
CPA Practice Test 2Tutor mode
Question 1 of 10
Federal Taxation of Entities (including tax preparation)
Corvex Manufacturing, Inc., a C corporation, reported book net income of $400,000 after deducting federal income tax expense of $90,000. Book income also reflects $8,000 of municipal bond interest, $5,000 of fines paid to a state agency and $12,000 of business meals. During the year Corvex also paid $50,000 of cash dividends to its shareholders, which it charged directly to retained earnings. Tax depreciation exceeds book depreciation by $20,000. What is Corvex's taxable income?