Hernandez which has been an S corporation since inception, is subject to tax in States Y and Z. On schedule K of its federal form 1120S, Hernandez reported ordinary income of $500,000 from its business, taxable interest income of $10,000, capital loss of $30,000 and $40,000 of dividend income from a corporation in which it owns 30%." Both states apportion income by use of three-factors formula that equally weights sales, payroll, and the average cost of property; both states treat interest and dividends as business income. In addition Y and Z follow Federal provisions with respect to the determination of taxable income for the corporation. Y recognizes S status, but Z does not. Based on the following information, write a memo to the shareholders of Hernandez detailing the amount of taxable income on which Hernandez will pay tax in Y and Z. Hernandez corporate offices are located at 5678 Alabaster Circle, Koopville, KY 47697