Income tax question 20 in official reading

Hi everyone,

I have a problem with the question 20 in the official reading 29.

The answer is C for this question. The explanation is: the income tax provision at the statutory rate of 34 percent is a benefit of $112,000, suggesting that the pre-tax income was a loss of $112,000/0.34 = ($329,412). The income tax provision was $227,000. ($329,412) − $227,000 = ($556,412).

Why don’t we also adjust for the “expenses not deductible for income tax purposes” (357,000)? The ($329,412) represents the pre-tax income under the tax statement. When we convert back to pre-tax income under accounting statement, do we deduct the “expenses not deductible for income tax purposes”?

Thank you.