On January 1, 2020. Keefe Corporation purchased equipment at a cost of \(\$ 100,000\). The equipment has a fiveyear life and no salvage value. The depreciation schedule for tax and accounting purposes follows.

Pretax GAAP income for each year 2020 through 2023 is \(\$ 120,000\) and the tax rate is \(25 \%\). There are no other differences between tax and financial accounting income.

a. Prepare a schedule calculating the deferred tax balance at the end of years 2020-2023.

b. Record the income tax journal entry on December 31, 2020.

c. Record the income tax journal entry on December \(31,2021\).

d. Record the income tax journal entry on December 31, 2022.

e. Record the income tax journal entry on December \(31,2023\).

f. Repeat (a) through (d) instead assuming that the company expensed \(100 \%\) of the equipment in 2020 for tax purposes.

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Year GAAP Depreciation Tax Depreciation 2020 $20,000 $25,000 2021 2022 2023 2024 20,000 20,000 20,000 20,000 38,000 37,000 0 0