In Year 1, George Michael Co. had financial accounting income of $850,000 before taxes, including $250,000 paid on premiums for life insurance of the C-suite officers (non-deductible expense). Other differences include $500,000 of rent revenue received in advance on January 1 Year 1 for a 5-year rent agreement to a customer ($100,000 earned each year) and an additional $150,000 difference because of tax depreciation (i.e., tax depreciation exceeds book depreciation). If George Michael Co. has a tax rate of 21%, what is the income tax expense on the December 31 Year 1 financial statements?

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