4

Required information [The following information applies to the questions displayed below.] Hafnaoui Company reported pretax net income from continuing operations of $863,500 and taxable income of $612,500. The book-tax difference of $251,000 was due to a $286,000 favorable temporary difference relating to depreciation, an unfavorable temporary difference of $124,000 due to an increase in the reserve for bad debts, and a $89,000 favorable permanent difference from the receipt of life insurance proceeds. a. Compute Hafnaoui Company's current income tax expense