Nepomuzeno, Inc. Temporary Permanent Differences, Deferred1. The
records of Nepomuzeno, Inc. provided the following information2012 2013 2014 2015Pretax income 90,000 92,000 95,000 98,000Taxable income 63,000 101,000 104,000 107,000Income Tax rate 30% for all yearsThe above amounts include only two temporary differences;a. Installment
sales for accounting purposes in 2012, $30,000 included in tax return, $10,000
each year from 2013 to 2015b. Cost of
warranties for accounting purposes, $4,000 in 2012, deducted for income tax
$1,000 each year from 2012 to 2015Required1. Prepare
schedule to reconcile accounting and taxable income and to compute taxes
payable2. Prepare a
schedule of temporary differences and deferred income taxes3. Prepare
Journal entry for each year
4. Show how
income tax expenses, deferred income tax asset or liability and income taxes
payable should be reported on the financial statements for each year