Selected financial information for Windham, Inc., for the year just ended is shown below. ...

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Accounting

Selected financial information for Windham, Inc., for the year just ended is shown below.

Pretax income

$5,000,000

Interest received on municipal bonds

600,000

Gain on the sale of land reported this

year but not taxable until next year

1,000,000

Tax rate for all years

40%

Beginning balances:

Income taxes payable

-0-

Deferred tax liability

$50,000

The total income tax expense reported on Windhams income statement for the year just ended should be
A. $960,000
B. $2,640,000
C. $1,760,000
D. $1,360,000

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