Solved by verified expert :Tax 496/596Winter 2014Research/Planning Problem #1Reconciliation of Book Income to Taxable IncomeRamsey Corporation, a C corporation, reports the following results for the current year:Net income per books 650,000Federal income tax 221,000Tax-exempt interest income 5,000MACRS/Tax depreciation 140,000Book depreciation 100,000Capital loss 12,000Insurance premiums on life of corporateofficer (Ramsey is the beneficiary of the policy) 15,000Charitable contributions 98,000Cash dividends paid 20,000Dividends received from an small equity investmentown less than 10% of entity 3,000Accrued bonus to cash basis shareholder 25,0001. Prepare a Schedule M-1 reconciling Ramsey’s book income to it’s taxableincome in 2013.2. Name the code section which gives the rules associated with the limitations onthe following deductions:a. Charitable contributionb. Capital lossc. Dividends received deduction3. Assume zero estimates were paid in during the year, calculate the tax due.Ignore any type of penalties that may apply.Do not calculate the alternative minimum tax.Please prepare your answer in an excel spreadsheet.The score is based on a point rubric, so show all of your work.

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