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The information that follows pertains to the Reeves Company:
Point 1. At December 31, 2020, temporary differences were associated with the following future taxable (deductible) amounts:
Depreciation $60,000
Prepaid expenses 17,000
Warranty expenses (12,000)
Point 2. No temporary differences existed at the beginning of 2020.
Point 3. Pretax accounting income was $80,000 and taxable income was $15,000 for the year ended December 31, 2020.
Point 4. The tax rate is 40%.
Question 1: Determine the Income tax Expense for 2020.
Financial Statement Analysis and Preparation
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