During 2021, Legolas Corporation has several differences between their pre tax accounting income and their taxable income Legolas Corporation provides the following information for 2021 Item Amount Income before taxes (GAAP) $400,000 Cash sales $138,000 Sales on account (taxable when cash is received) $55,000 Estimated warranty expense (deductible when cash is paid) $78,000 Interest revenue from a tax free municipal bond $74,000 There are no other possible book tax differences for 2021 What is Legolas Corporations taxable income for 2021 $423,000 $487,000 $211,000 $349,000

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Question: During 2021, Legolas Corporation has several differences between their pre-tax accounting income and their taxable income. Legolas Corporation provides the following information for 2021: Item

During 2021, Legolas Corporation has several differences between their pre-tax accounting income and their taxable income. Legolas Corporation provides the following information for 2021:

Item	Amount
Income before taxes (GAAP)	$400,000
Cash sales	$138,000
Sales on account (taxable when cash is received)	$55,000
Estimated warranty expense (deductible when cash is paid)	$78,000
Interest revenue from a tax-free municipal bond	$74,000

There are no other possible book-tax differences for 2021. What is Legolas Corporations taxable income for 2021?

$423,000

$487,000

$211,000

$349,000

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