1-5 please !

Canders Inc. began business in 2021. In preparing Canders financial statements and income tax return for 2021, you discovered the following: Canders Inc. leased part of its office building to Sanders Inc on September 1 for an advance payment of $198,000. The lease covers 18 months, and the advance payment is for 12 months Canders earned $25,000 of interest from its investment in Washington State bonds. Canders, paid Prudential Life Insurance Inc. the yearly premium of $30,000 in carly January for a key-man life insurance policy. The Company is the beneficiary. Canders acquired capital assets for $324,000. For financial reporting, the assets have a 6- year useful life and So salvage. For income taxes, the capital assets are 5-year property and cost will be recovered using the mid-year convention. Year Depreciation expense Accounting Tax 2021 $54,000 S. 65.000 2022 54.000 104,000 2023 54.000 62,000 2024 54.000 37.000 2025 54,000 37,000 2026 54,000 19,000 Sanders sold some real estate in 2021 for a gain of $150,000. For federal income taxes, the gain will be reported using the installment method. Gain reported on the income statement Gain reported on tax the tax retum $150,000 2021 2022 2023 2024 $38,000 40,000 40,000 32.000 Additional information for 2021: I . Income before income taxes reported on the income statement Taxable income reported on line 28 of Form 1120 Tax rate Estimated income tax paid each quarter . $825.000 839.000 21% 43,000 Select the best answer for each of the following questions and type the letter on the answer sheet. Questions through involve the reconciliation of accounting income before income taxes to taxable income (schedule M-1) for 2021. For each question, indicate the type of difference (temporary or permanent) and indicate whether the amount of the item is added or subtracted to determine taxable income for 2021. 1. The rent received from Sanders: Type of difference Treatment in the reconciliation A Permanent Added . Temporary Subtracted . Permanent Subtracted D. Temporary Added 2. The excess of tax depreciation over book depreciation: Type of difference Treatment in the reconciliation Permanent Added B Temporary Subtracted C. Permanent Subtracted D. Temporary Added 3. The interest revenue on Washington State bonds: Type of differenes Treatment in the reconciliation A Permanent Added Temporary Subtracted Permanent Subtracted Temporary Added 4. The insurance premium on the key-man life insurance policy: Type of difference Treatment in the reconciliation Permanent Added B Temporary Subtracted Permanent Subtracted Temporary . . C D . C D Added 5. The gain from on the sale of real estate: Type of difference Treatment in the reconsiliation Permanent Added B Temporary Subtracted Permanent Subtracted D Temporary Added