Problem 12-18 (Algo) [LO 12-7] During a recent IRS audit, the revenue agent decided that the Parker family used their closely held corporation, Falco, to avoid shareholder tax by accumulating earnings beyond the reasonable needs of the business. Falcos taxable income was $890,000, it paid no dividends, and it had no business need to retain income. Falcos marginal tax rate in prior years was 34 percent. Required: Compute Falcos accumulated earnings tax assuming that it had accumulated $5 million after-tax income in prior years. Compute Falcos accumulated earnings tax assuming that it had accumulated $129,000 after-tax income in prior years.