Computation of taxable income. The records for Bosch Co. show this data for 2018: ·         Gross profit on installment sales recorded on the books was $480,000. Gross profit from collections of installment receivables was $320,000.   Life insurance on officers was $3,800. Machinery was acquired in January for $300,000. Straight-line depreciation over a ten-year life (no salvage value) is used. For tax purposes, MACRS depreciation is used and Bosch may deduct 14% for 2018. Interest received on tax exempt Iowa State bonds was $9,000. The estimated warranty liability related to 2018 sales was $21,600. Repair costs under warranties during 2018 were $13,600. The remainder will be incurred in 2019. Pretax financial income is $700,000. The tax rate is 30%.   Instructions (a)    Prepare a schedule starting with pretax financial income and compute taxable income. (b)    Prepare the journal entry to record income taxes for 2018.

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