121928596 Chapt 8 Deduct From Gross Income2013
Transcript of 121928596 Chapt 8 Deduct From Gross Income2013
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INCOME TAXATION 6TH Edition (BY: VALENCIA & ROXAS)SUGGESTED ANSWERS
C!"t#$ %: D#d'tion $o* G$o In'o*#
CHA+TER %
DEDUCTIONS ,ROM GROSS INCOME
Problem 8 1 DEDUCTIBLE OR NONDEDUCTIBLE FROM GROSS INCOME
1. Nondeductible2. Deductible
3. Deductible4. Deductible5. Nondeductible6. Nondeductible
7. Nondeductible8. Deductible
9. Deductible10. Deductible
11. Nondeductible12. Nondeductible13. Deductible, in lieu of tax credit (Sec. 343, N!"#14. Deductible15. Deductible16. Nondeductible17. Nondeductible18. Deductible19. Deductible20. Nondeductible
Problem 8 2 TRUE OR FALSE
1. $al%e & So'e bu%ine%% exen%e% are nondeductible) %o'e are %ub*ect to li'it.2. +rue3. $al%e & o'en%ation inco'e i% not %ub*ect to SD.4. $al%e & N- i% not an ite'ied deduction.5. +rue & /'ortied oer te ter' of te lea%e6. $al%e & of 17. $al%e & 338. $al%e & Double &declinin 'etod9. +rue10. +rue11. $al%e & !nco'e out%ide te iliine% b a N" i% not taxable in te iliine%,
ence, no alloable deduction i% alloed.12. +rue13. +rue14. +rue15. $al%e & u%ine%% exen%e% related to bu%ine%% inco'e out%ide te iliine% i%
deductible al%o b do'e%tic cororation% and re%ident $iliino.
16. $al%e & u%ine%% exen%e i% deductible fro' ro%% inco'e.17. +rue18. $al%e & 40 ba%ed on %ale% or ro%% receit%.
Problem 8 3 Problem 8 4 Problem 8 5 Problem 8
1. 1. D 1. / 1.
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INCOME TAXATION 6TH Edition (BY: VALENCIA & ROXAS)SUGGESTED ANSWERS
C!"t#$ %: D#d'tion $o* G$o In'o*#
2. 2. 2. 2. 3. / 3. 3. 3.
4. D 4. 4. / 4. 5. / 5. / 5. D 5. 6. 6. D 6. 6. D7. / 7. 7. / 7. D8. 8. 8. 8. /9. 9. / 9. / 9. 10. D 10. / 10. 10.
Problem 8 ! C
xen%ed aitaliedane of 'otor of air condition 60,000xan%ion of %tore 50,000Da'ae% aid due to or:er%; in*ur 20,000"eaintin of buildin 10,000leanin of co'uter% 9,000"eair of furniture 1,000 .+otal% 40,000 110,000
Problem 8 8 C
!dentifiable oeratin exen%e% & iliine% 400,000/dd< /llocated oeratin exen%e% itin (200,000 x 1=>5=# 40,000eratin exen%e% & iliine% 440,000
Problem 8 " D
olice rotection 20,000!ntere%t exen%e aid to i% fater 10,000?ift% 'ade to e'loee% durin birtda 5,000aital lo%% 4,000
/'ount of nondeductible exen%e% and lo%%e% 39,000
Problem 8 1# D
Dereciation exen%e (1,000,000 x 40#>25 16,000-o%% of bu%ine%% e@ui'ent 38,000Deductible exen%e 54,000
Problem 8 11 D
1. Le$$er ANo er%onal or bu%ine%% exen%e i% deductible.
2. Le$$er BDereciation (20,000 x 10# 2,000"eair (100,000 x 10# 10,000ffice %ulie% 6,000+otal deduction 18,000
Problem 8 12 B
+ax la% ?//Salar exen%e (180,000 A 20,000# 200,000 200,000%ti'ated uncollectible account% 10,000o'ro'i%e enalt 50,000Dereciation exen%e 30,000 30,000=i%cellaneou% exen%e . 5,000
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INCOME TAXATION 6TH Edition (BY: VALENCIA & ROXAS)SUGGESTED ANSWERS
C!"t#$ %: D#d'tion $o* G$o In'o*#
Deductible fro' earnin% 230,000 295,000
Note< $or tax uro%e%, te 'i%cellaneou% exen%e i% not deductible becau%e it a% notreorted la%t ear. $or accountin uro%e%, te 'i%cellaneou% exen%e can be deducted a%rior eriod ad*u%t'ent fro' retained earnin%.
Problem 8 13 A
Sale% 300,000
=ultilied b SD rate 40tional %tandard deduction 120,00
0
+e co'en%ation inco'e i% not included in deter'inin SD. +e SD (40 ofro%% %ale% or ro%% receit%# i% onl alloed a% deduction fro' inco'e deried fro'bu%ine%%. !f an indiidual oted to u%e SD, e i% no loner alloed to deduct co%t of%ale%. BSec. 34(-#, N!") Sec. 3, "e. "e%. No. 16C2008
Problem 8 14 B
?ro%% receit% fro' rofe%%ion 100,000"ent inco'e (475,000>95# 500,000+otal ro%% inco'e 600,000=ultilied b ercent of SD 40tional %tandard deduction 240,000
Problem 8 15 D
Since tere are no official receit% and docu'ent% to %uort te oeratinexen%e%, te reorted oeratin exen%e% are not deductible (Sec. 34(/#(b#, N!"#.
+e SD i% not alloed for nonre%ident alien% (Sec. 34(-#, N!"#. No er%onalexe'tion ill be ranted to a nonre%ident alien it bu%ine%% in te iliine% ifi% countr doe% not ae an exe'tion recirocit la faorin a $iliino citien.(Sec. 9, "e. "e%. No. 2#
Problem 8 1 A
Sole rorietor ororation
Sale% 1,000,000
1,000,000
-e%%< o%t of %ale% . 300,000a%i% of SD 1,000,00
0 700,000
=ultilied b SD rate 40 40tional %tandard deduction
400,000 280,000
"/ 9504 i% %ecific a% to te ba%i% of SD. $or indiidual%, te ba%i% of te 40 SD%all be te Ero%% %ale%F or Ero%% receit%.F !n te ca%e of cororate taxaer%%ub*ect to tax under Section% 27(/# and 28(/#(1# of te +ax ode, a% a'ended, teba%i% of te 40 SD %all be te Ero%% inco'e.F
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INCOME TAXATION 6TH Edition (BY: VALENCIA & ROXAS)SUGGESTED ANSWERS
C!"t#$ %: D#d'tion $o* G$o In'o*#
Problem 8 1! B
eratin exen%e before rere%entation exen%e(2,000,000 & 300,000# 1,700,000
"ere%entation exen%e & /ctual 300,000 C -i'it (20,000,000 x 0.005# 100,000 C -oer 100,000/lloable ite'ied deduction% 1,800,000
Problem 8 18 B
Salar exen%e 120,000"ent exen%e 24,000/derti%in exen%e 6,000Dereciation exen%e 5,000
!ntere%t exen%e 60,000+ax differential on intere%t inco'e (30,000 x 33# ( 9,900#+otal ite'ied deduction% 205,100
NOLCO is not an itemized deduction.
Problem 8 1" D
G%in SD G%in!te'ied
Sale% 1,200,000
1,200,000
o%t of %ale% C 0 C 700,000?ro%% inco'e 1,200,00
0 500,000
-e%%< SD or !te'ied deduction% (1,200,000 x 40# 480,00
0 C 0 C
Net inco'e before er%onal exe'tion 720,000
500,000
/lloed deduction u%in SD (1,200,000 x 40# 480,000-e%%< o%t of %ale% 700,000Net di%adantae u%in SD (220,000#
No ite'ied deduction i% alloed if no official receit%, record% or oter ertinentaer% can be u%ed to %uort it (!" %. !%abela ultural ororation, ?.". No.172231, $eb. 12, 2007#.
!n ca%e of indiidual taxaer, te Eco%t of %ale%F or te Eco%t of %erice%F are notalloed to be deducted for uro%e% of deter'inin te ba%i% of SD ina%'uc a%te la ("/ 9504# i% %ecific a% to te ba%i% tereof ic %tate% tat for indiidual%,te ba%i% of te 40 %all be te Ero%% %ale%F or Ero%% receit%F and not teEro%% inco'e.F (Sec. 3, "e. "e%. No. 16C2008#
Problem 8 2# A
?ro%% %alarie% of e'loee% 6,000,000
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INCOME TAXATION 6TH Edition (BY: VALENCIA & ROXAS)SUGGESTED ANSWERS
C!"t#$ %: D#d'tion $o* G$o In'o*#
?ro%%edCu 'onetar alue of frine benefit% 1,000,000Deductible %alarie% and frine benefit% exen%e% 7,000,000
Problem 8 21 C
/%%u'e bonu% i% co'uted after tax but before bonu%. +e an%er i% letter D H 8,143,co'uted a% follo%
-e%%< !nco'e tax (76,000 & 8,382# x 30 20,285!nco'e after tax but before bonu% 55,715=ultilied b rate of bonu% 15onu% 8,356
Problem 8 22 B
=ontl %alar 5,000Deat benefit% 50,000+er'inal a 25,000ontinuou% co'en%ation after te burial for tree 'ont% 15,000+otal deductible exen%e% 95,000
Note< Donation for coffin and oter a:e exen%e% i% not bu%ine%% or co'en%ation relatedand, ence, not deductible. (Sec. 72, "e. "e%. 2#
Problem 8 23 C
!nentoriableco%t
Sulie% exen%e
urca%e% 300,000 40,000Decrea%ed in inentor 20,000!ncrea%ed in inentor . ( 3,000#
320,000 37,000Problem 8 24 D
+raelin exen%e% (50,000 A 200,000# 250,000
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INCOME TAXATION 6TH Edition (BY: VALENCIA & ROXAS)SUGGESTED ANSWERS
C!"t#$ %: D#d'tion $o* G$o In'o*#
$rine benefit exen%e (68,000>68# 100,000+ran%ortation exen%e & 'e%%ener 40,000
+otal alloable exen%e 390,000
Problem 8 25 B
=ontl rent (20,000 x 60# x 2 'o% fro' ct. 31 to Dec. 31 24,000!n%urance re'iu' (3,000 x 60# x 2>12 300"eal roert tax (1,500 x 60# x 2>12 150Deductible rent exen%e 24,450
Note< +e cit %erice% i% not a rent exen%e.
Problem 8 2
1. Le$$er B "ent for 6 'ont% ba%ed on u%ae (20,000 x 6# x 80 96,000
2. Le$$er D
/ctual ca% collection for rent 150,000
Problem 8 2! D
=ontl rental exen%e 2,000=ontl dereciation (600,000>8#> 12 6,250=ontl deductible exen%e 8,250
Problem 8 28 C
"ent exen%e (5,000 x 12# 60,000/dd< Dereciation exen%e B(950,000>9.5# x 11>12 91,667Deductible exen%e in 200 151,667
/t te %tart of te u%ed of te buildin, te re'ainin eriod for te contract of lea%ei% 9.5 ear%. +e %alae alue i% inored in te co'utation of te dereciation
becau%e + $ood% could no loner benefit on it %ince te i'roe'ent on te landill be oned b te le%%or at te end of te 10Cear contract of lea%e.
Problem 8 2"
1. Le$$er B +radin C -i'it loer (5,000,000 x .005# 25,000
2. Le$$er C Sericin & actual loer 30,000
Problem 8 3# B
/ctual rere%entation exen%e 10,000=ultilied b ercent of rere%entation exen%e
for %ale% B700,000>(700,000 A 300,000# 70/ortioned rere%entation exen%e for %ale% 7,000-i'it (700,000 x 0.005#, loer 3,500
/ctual rere%entation exen%e 10,000=ultilied b ercent of rere%entation exen%e
for reenue B300,000>(700,000 A 300,000# 30/ortioned rere%entation exen%e for %ale% 3,000-i'it (300,000 x 0.01# 3,000Deductible rere%entation exen%e 6,500
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INCOME TAXATION 6TH Edition (BY: VALENCIA & ROXAS)SUGGESTED ANSWERS
C!"t#$ %: D#d'tion $o* G$o In'o*#
Problem 8 31 A
!ntere%t exen%e 40,000+ax differential (50,000 x 33# (16,500#Deductible intere%t exen%e 23,500
Problem 8 32 B
rea%tCfeedin a%%i%tance to te need & additional 200,000Salar of %enior citien% & additional (100,000 x 15# 15,000Senior;% citien di%count (300,000 x 20# 60,000
+otal %ecial ite'ied deduction 275,000
Problem 8 33 B
Deductible Nondeductible
!ntere%t aid in adanced 20,000!ntere%t aid to a broter 12,000!ntere%t aid on delin@uenc taxe% 8,000!ntere%t on borroin% to finance i% fa'il o'e 30,000!ntere%t aid to finance etroleu' exloration . 100,000+otal 8,000 162,000
Problem 8 34 B
!ntere%t exen%e on unaid %alarie% 60,000/dd< Nondeductible tax differential (40,000>80# x 33 16,500Nondeductible intere%t exen%e 76,500
Salar exen%e 600,000"ent exen%e 200,000
Deductible intere%t exen%e ban: loan (40,000 & 16,500# 23,500+otal ite'ied deduction% 823,500
+e %alarie% of direct or:er% %ould be cla%%ified a% deductible co%t of %erice andnot to be cla%%ified a% art of ite'ied deduction% ("e. "e%. No.16C2008#. !ntere%texen%e on unaid %alarie% i% not deductible. (Iuenel J Streiff, !nc. %. ollector of!nternal "eenue, 106 il. 355#
Problem 8 35 D
+ax %ain% fro' intere%t exen%e (100,000 x 30# 30,000$inal tax on intere%t inco'e (1,000,000 x 12# x20
(24,000#
/ctual net tax %ain% 6,000
Problem 8 3 A
Docu'entar %ta' taxe% 1,000-ocal tax (6,000 & 800 & 200# 5,000=unicial tax 2,000o''unit tax 1,500Deductible taxe% 9,500
Note< +e frine benefit inco'e taxe% to :e officer% and ran:CinCfile e'loee% are to becla%%ified a% deductible frine benefit exen%e and not tax exen%e.
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INCOME TAXATION 6TH Edition (BY: VALENCIA & ROXAS)SUGGESTED ANSWERS
C!"t#$ %: D#d'tion $o* G$o In'o*#
Problem 8 3! C
u%ine%% taxe% 20,000Docu'entar %ta' taxe% 1,000/uto'obile rei%tration fee% 3,000o%tae %ta' taxe% 500!'ort dut taxe% 50,000
+otal deductible taxe% 74,500
Problem 8 38 D
Gnad*u%ted net inco'e (520,000 & 200,000# 320,000/dd bac:< !nco'e tax forein countr 10,000/d*u%ted net inco'e 330,000er%onal exe'tion (50,000#Net taxable inco'e 280,000
Note< +e 10,000 inco'e tax aid to forein countr i% better to be treated a% tax creditrater tan a% oeratin exen%e.
Problem 8 3" A
/%%et of lia 60,000a'ent to oern'ent (200,000 x 50# (100,000#alance (40,000#
Deductible bad debt% i% te entire a'ount ofcollectible%
100,000
Problem 8 4# B
ad debt% fro' bu%ine%% actual ritten off (100,000 x40#
40,000
ad debt% fro' rofe%%ion actual ritten off 50,000Deductible bad debt% exen%e 90,000
Problem 8 41 D
/nnual dereciation exen%e (50,000 & 5,000#>5 9,000=ultilied b ratio of 'ont% u%ed durin te ear (fro' Kune 30 to Dec. 31# 6>12Dereciation exen%e 200 4,500
Problem 8 42 A
/nnual dereciation (2,300,000>11.5 ear%# 200,000=ultilied b ratio of 'ont% u%ed in 200 (Kul 1 to Dec.# 6>12Dereciation exen%e 100,000
Problem 8 43 D
il drillin 'acine (800,000 x 90#>8 ear% 90,000
il extractin 'acine (900,000 x 90#>10 ear% & li'it 81,000o'uter% (100,000 x 90#>4 ear% 22,500Delier truc: (200,000 x 90#>5 ear% & li'it 36,000/nnual dereciation exen%e 229,500
+e u%eful life of roertie% u%ed in or related to roduction of etroleu'%all be ten (10# ear% or %uc %orter life a% 'a be er'itted b te !"o''i%%ioner. roertie% not u%ed directl in te roduction of etroleu'%all be dereciated under te %traitCline 'etod on te ba%i% of an
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INCOME TAXATION 6TH Edition (BY: VALENCIA & ROXAS)SUGGESTED ANSWERS
C!"t#$ %: D#d'tion $o* G$o In'o*#
e%ti'ated u%eful life of fie (5# ear%. (Sec. 34($#(4#, N!"#
Problem 8 44 CDeletion ba%e (6,000,000 & 1,000,000 A 300,000# 5,300,000Diided b nu'ber of extractible e%ti'ated ton% 5,000,000Deletion er ton 1.06=ultilied b nu'ber of ton% extracted durin te ear 800,000Deletion exen%e 848,000
Problem 8 45
1.
Le$$er D
Deletable co%t%, Kanuar 1, 200x 12,500,000xloration co%t% 1,000,000!ntanible deelo'ent co%t% 1,500,000+otal 15,000,000
-e%%< Deletion exen%e (15,000,000>7,500,000# x 1,200,000 2,400,000/d*u%ted ba%i% 1,260,000Diided b re'ainin re%ere%
(5,000,000 A 2,500,000 & 1,200,000# 6,300,000Ne deletion rate> unit 2.00
2.
Le$$er A
Deletion co%t 2007 (2 x 1,200,000 unit%# 2,400,000
3.
Le$$er B
Lalue of roduction (12 x 1,200,000 unit%# 14,400,000-e%%< roduction and %ellin co%t%< =inin co%t% 2,000,00
0 =illin co%t% 3,000,000 =ar:etin exen%e% 1,500,000 Dereciation exen%e 1,000,00
0 7,500,000
Net inco'e fro' oeration 6,900,000=ultilied b li'it ercentae 25Deductible a'ount fro exloration and deelo'ent co%t 1,725,000
4.
Le$$er B
urrent exloration and deelo'ent co%t (1,500,000 A1,000,000#
2,500,000
-e%%< Deductible a'ount of exloration and deelo'ent co%t (%ee3#
1,725,000
xloration and deelo'ent co%t careable to %ucceedin ear% 775,000
Problem 8 4 B
Deductible exen%e< aitalied utrit exen%eDereciation exen%e (10,000,000 x 90#>50 180,000aital outla 10,000,000
Problem 8 4!
1 Le$$er B 200/ 200 200-oer of actual contribution or nor'al 800,000 800,000 500,000
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INCOME TAXATION 6TH Edition (BY: VALENCIA & ROXAS)SUGGESTED ANSWERS
C!"t#$ %: D#d'tion $o* G$o In'o*#
aluation/dd< /'ortiation of exce%%
200/ (200,000>10# 20,000 20,000 20,000 200 (100,000>10# . 10,000 10,000Deductible retire'ent exen%e 820,000 830,000 530,000
2. Le$$er A 200/ 200 200/ctual retire'ent a'ent% 0 400,000 300,000
Problem 8 48 A
Mear Mear M/ctual contribution or nor'al aluation, loer 700,000 600,000/dd< /'ortiation (100,000>10# 10,000 10,000Deductible retire'ent exen%e 710,000 610,000
No$e% nl te exce%% of te actual contribution oer te nor'al aluation i% to be a'ortiedoer 10 ear%.
Problem 8 48 B
/lloed deductible contribution (200,000 x 5# 10,000
Problem 8 4" B
/lloed deductible contribution (200,000 x 5# 10,000
Problem 8 5# D
/lloed deductible contribution B(60,000 A 5,000# x 10 6,500
Problem 8 51 B
!nco'e before caritable contribution (500,000 & 130,000# 370,000=ultilied b ercent of li'it 5/lloed deductible contribution C loer 18,500
Problem 8 52 A
OO! er 'ont 200
Problem 8 53 D
Not alloed to deduct OO! becau%e fa'il inco'e exceeded 250,000 er ear.
Problem 8 54 C
/ctual alue of donation & riorit rora' 1,000,000/dot a %cool rora' & incentie (1,000,000 x 50# 500,000Deductible donation 1,500,000
Problem 8 55
1. eratin exen%e% (1,000,000 x 30# & 50,000 250,000!ntere%t exen%e (50,000 & (40,000>80# x 33 33,500+otal ite'ied deduction% 283,500/dd< N- 500,000+otal deductible exen%e% 783,500
No$e%N- i% not an ite'ied deduction but art of deductibleexen%e%.
2. ?ro%% inco'e (5,000,000 & 2,000,000# 3,000,000=ultilied b SD rate 40
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INCOME TAXATION 6TH Edition (BY: VALENCIA & ROXAS)SUGGESTED ANSWERS
C!"t#$ %: D#d'tion $o* G$o In'o*#
SD 1,200,000
No$e%N- i% not alloed to be deducted if te taxaer u%e% SD.
3. ?ro%% inco'e 3,000,000-e%%< SD 1,200,000Net taxable inco'e 1,800,000
Problem 8 5Salarie% of a%%i%tant% 96,000+raelin exen%e% 11,000-it and ater & office 7,890Stationerie% and %ulie% 1,960ffice rent 60,000+otal oeratin exen%e% before contribution 176,850/dd< ontribution %ub*ect to li'it (500,000 & 176,850# x 10# 32,315/lloable ite'ied deduction% 209,165
Problem 8 5!
Solerorietor%i ororation artner%i
ad debt% rittenCoff (35,000 & 30,000#Dereciation exen%e (140,000 & 100,000#
Donation to te oern'ent & rioritrora'Donation% %ub*ect to li'it< -oer of actual, 170,000 or
(2,500,000 x 10# (2,500,000 x 5#+otal alloable deduction%
5,00040,000
50,000
170,000 .
265,000
5,00040,000
50,000
125,000 220,000
5,00040,000
50,000
125,000 220,000
+e re%earc and deelo'ent co%t i% to be treated a% a deferred exen%e, ence, it%a'ortiation %all be 'ade in te %ucceedin fie ear% en te taxaer realie%benefit% fro' %uc exenditure% (Sec. 341, N!"#.
Problem 8 58
1. 200/ 200/ctual contribution or nor'al aluation, loer 1,000,000 900,000
/dd< /'ortiation C 200/ (250,000>10# 25,000 25,000Deductible retire'ent exen%e 1,025,000 925,000
2. $inancial net inco'e 50,000,000 60,000,000/dd< "etire'ent benefit exen%e & accountin 1,100,000 1,200,000+otal 51,100,000 61,200,000-e%%< Deductible retire'ent exen%e & taxation 1,025,000 925,000Net inco'e for tax uro%e% 50,075,000 60,275,000
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INCOME TAXATION 6TH Edition (BY: VALENCIA & ROXAS)SUGGESTED ANSWERS
C!"t#$ %: D#d'tion $o* G$o In'o*#
Problem 8 5"
ororation !ndiidual
Salar exen%e% 500,000 500,000"etire'ent (250,000 A 50,000>10# 255,000 255,000"ere%entation exen%e (10,000,000 x .005# 50,000 50,000!ntere%t exen%e aid to te !" C full 20,000 20,000!ntere%t exen%e & li'it< (100,000 & (96,000>80# x 33# 60,400 60,400Dereciation exen%e 40,000 40,000"ent exen%e 250,000 250,000?rou in%urance exen%e 50,000 50,000ad debt% exen%e (100,000 x 20# 20,000 20,000ontribution exen%e%< +SD/ riorit ro*ect (500,000 x 1.5# 750,000 750,000 -ocal oern'ent & li'it (loer i% actual# 100,000 100,000+otal ite'ied deduction% 2,095,400 2,095,400
No$e%N- i% an alloable %ecial deduction but not an ite'ied deduction.
Problem 8 #
1. !ndiidual ororationSalarie% exen%e (680,000 & 100,000# 580,000 580,000ad debt% exen%e (370,000 & 270,000# 100,000 100,000"etire'ent exen%e (1,000,000 & 380,000# 620,000 620,000"ere%entation exen%e (39,000,000 x 0.005# 195,000 195,000"ent exen%e% (200,000 & 20,000# 180,000 180,000+axe% exen%e (300,000 & 270,000# 30,000 30,000-ife in%urance exen%e (150,000 & 100,000# 50,000 50,000!ntere%t exen%e B(200,000 & (50,000 x 33# A 20,000 203,500 203,500+otal ite'ied deduction before contribution% 1,958,500 1,958,500
ontribution exen%e%< Donation to +SD/ riorit ro*ect (500,000 x 150# 750,000 750,000 Donation% for "oo'inCin and rea%tCfeedin (200: x 2# 400,000 400,000 Donation% N?;% (35 for ad'in.# 100,000 100,000 !nd< (39,460,000 & 30,000,000 & 1,958,500# x10H750,150
or< (39,460,000 & 30,000,000 & 1,958,500# x 5H375,075 . .+otal alloable deduction% 3,208,500 3,208,500
o'utation of %ale%