Assume Stata Co. purchases a machine for its factory on 1/1/09. The machine cost $6,000, had no salvage value and had an estimated useful life of three years. Kevin Company depreciates the machine using the straight line method for its financial books and the sum of the years digits method for tax purposes. Kevin Companys pretax financial income, before considering depreciation is $5,000 each year. Tax rate is 40%.

1. Find Current Tax Expense or Income tax Expense. Determine whether Deferred tax liability or Asset. Show all Work

2.Make required Journal entries