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BE17-12. VE WICHSt 4 years. Temporary Differences, Deferred Tax Asset. Reflections Mirrors, Ltd. offers a 3-year warranty on all its products. In Year 1, the

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BE17-12. VE WICHSt 4 years. Temporary Differences, Deferred Tax Asset. Reflections Mirrors, Ltd. offers a 3-year warranty on all its products. In Year 1, the company reported income before warranty expense of S620,000 and estimated that warranty repairs would cost the company $150,000 over the 3-year period. Actual repairs for the year amounted to $50,000. Reflections Mirrors' tax rate is 40%. Prepare the journal entries required to record the tax provision for Year 1. Temporary Differences, Deferred Tax Asset. Using the information for Reflections Mirrors, Ltd. pro- vided in BE17-12, prepare the journal entries required to record the tax provision for Year 2 assuming that Reflections reported income before warranty costs and taxes of $200,000 and incurred actual repair costs of $40,000. Assume that the firm did not accrue additional warranty costs in Year 2. BE17-13

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