Blossom Inc. began business on January 1, 2021. Its pretax financial income for the first 2 years was as follows: 2021 | | $360,000 | 2022 | | 680,000 | The following items caused the only differences between pretax financial income and taxable income. 1. | | In 2021, the company collected $396,000 of rent; of this amount, $132,000 was earned in 2021; the other $264,000 will be earned equally over the 20222023 period. The full $396,000 was included in taxable income in 2021. | 2. | | The company pays $11,200 a year for life insurance on officers. | 3. | | In 2022, the company terminated a top executive and agreed to $126,000 of severance pay. The amount will be paid $42,000 per year for 2022-2024. The 2022 payment was made. The $126,000 was expensed in 2022. For tax purposes, the severance pay is deductible as it is paid. | The enacted tax rates existing at December 31, 2021 are: 2021 | | 20% | | 2023 | | 30% | 2022 | | 25% | | 2024 | | 30% | | | | |