Rundle Corporation acquired new equipment for \(\$ 400,000\) in \(20 \mathrm{X} 4\). For accounting purposes, the equipment will be depreciated over four years, straight-line, with a full-year's depreciation in the first year. For income tax purposes, Olivetti can take CCA over the next three years of : \(\$ 200,000\) in \(20 X 4, \$ 125,000\) in \(20 X 5\), and \(\$ 75,000\) in \(20 X 6\). Olivetti's income tax rate is \(30 \%\).

Required:

For each 31 December, \(20 \mathrm{X} 4\) through 20X7, determine:

1. The tax basis for the equipment.

2. The accounting basis for the equipment.

3. The amount of the temporary difference relating to the equipment.

4. The amount of the deferred income tax expense.

5. The balance of deferred income tax asset or liability that would be shown on the statement of financial position.