The records of TNA Corporation at the end of 2020 provided the following data related to income taxes.

- Unrealized gain on the company's investment portfolio, \(\$ 50,000\); recognized in net income for accounting purposes at the end of 2020 . Amount will be considered for tax purposes when sold, estimated to be in 2022. Fair value of the investment portfolio on December 31,2020 , is \(\$ 400,000\).

- Estimated litigation expense, \(\$ 30,000\); accrued for accounting purposes at the end of 2020. Amount will be considered for income tax purposes when paid, estimated to be at the end of 2021.

- Taxable income (from the tax return) at the end of \(2020, \$ 100,000\); the enacted income tax rate is \(25 \%\). There were no deferred tax amounts at the beginning of 2020.

Required

a. Prepare a schedule to determine difference between the tax basis and the GAAP basis for the investment account and the accrued litigation liability account, and the related deferred tax balance(s) on December 31, 2020.

b. Determine pretax GAAP income for 2020 .

c. Prepare the journal entry to record income tax expense in 2020 .

d. Prepare the income tax section of the income statement for 2020 and provide the disclosure of current and deferred tax expense.

e. Indicate the deferred income tax amount that would be recognized on the balance sheet on December 31, 2020.