Zygote Ltd. recorded warranty expense of $125,000 in 20X6, $35,000 in 20X7, and $75,000 in 20X8. Warranty claims paid were $70,000 in 20X6, $55,000 in 20X7, and $90,000 in 20X8. Warranty amounts are tax-deductible when the cash is paid. Zygote’s income tax rate is 28%.

Required:
For each 31 December 20X6 through 20X8, determine:
1. The tax basis for the warranty liability.
2. The accounting basis for the warranty liability.
3. The cumulative amount of the temporary difference relating to the warranty liability.
4. The balance of deferred income tax asset or liability that would be reported on the statement of financial position.
5. The amount of the deferred income tax adjustment.