Assume that Genius' 2022 pretax accounting income is $55,000 and that Genius reports $15,000 more depreciation expense for tax purposes

than it shows in the accounting records, expected to reverse in 2025. Genius estimates that warranty costs associated with heaters sold in 2022

will be $40,000; Genius incurred another $20,000 in warranty claims satisfied in 2022. Also during 2022, Genius invests in tax-free municipal

municipal bonds that earn $28,000 interest in 2022.

A new tax law is enacted in 2022, increasing the tax rate from 21% in 2022 to 24% in 2023 and 25% in 2024 and thereafter.

d.

Prepare the journal entry necessary to record income taxes at the end of 2022.

e.

What will Genius report in the tax section of its 2022 income statement?