Hunt Co. at the end of 2021, its first year of operations, prepared a reconciliation between pretax financial income and taxable income as follows: Pretax financial income $ 950,000 Estimated warranty expenses deductible for taxes when paid 1,200,000 Extra depreciation (1,950,000) Taxable income $ 200,000 Estimated warranty expense of $800,000 will be deductible in 2022, $300,000 in 2023, and $100,000 in 2024. The use of the depreciable assets will result in taxable amounts of $650,000 in each of the next three years.
Hunt Co. at the end of 2021, its first year of operations, prepared a reconciliation between pretax financial income and taxable income as follows: Pretax financial income $ 950,000 Estimated warranty expenses deductible for taxes when paid 1,200,000 Extra depreciation (1,950,000) Taxable income $ 200,000 Estimated warranty expense of $800,000 will be deductible in 2022, $300,000 in 2023, and $100,000 in 2024. The use of the
(a) Prepare a table of future taxable and deductible amounts.
(b) Prepare the
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