Arnold Industries has pretax accounting income of $$160$ million for the year ended December $31,2024.$ The tax rate is $25\%.$ The only

difference between accounting income and taxable income relates to an operating lease in which Arnold is the lessee. The inception

of the lease was December $28,2024.$ An $$136$ million advance rent payment at the inception of the lease is tax$-$deductible in $2024$

but, for financial reporting purposes, represents prepaid rent expense to be recognized equally over the four$-$year lease term.

Required:

Complete the following table given below and prepare the appropriate journal entry to record Arnold's income taxes for $2024.$

Prepare the appropriate journal entry to record Arnold's income taxes for $2025.$ Pretax accounting income was $$210$ million for

the year ended December $31,2025.$

Assume a new tax law is enacted in $2025$ that causes the tax rate to change from $25\%$ to $15\%$ beginning in $2026.$ Complete the

following table given below and prepare the appropriate journal entry to record Arnold's income taxes for $2025.$

Complete this question by entering your answers in the tabs below.

Required $1$

Calculation

Required $1$ GJ

Required $2$

Required $3$

Calculation

Required $3$ GJ

Complete the following table given below to record Arnold's income taxes for $2024.$

Note: Enter your answers in millions rounded to $1$ decimal place $($i$.$e$.,5,500,000$ should be entered as $5\mathrm{.}5),$