Case Development began operations in December 2016. When property is sold on an installment basis, Case recognizes installment income for financial reporting purposes in the year of the sale. For tax purposes, installment income is reported by the installment method. 2016 installment income was $780,000 and will be collected over the next three years. Scheduled collections and enacted tax rates for 20172019 are as follows:

2017	$	186,000	30	%
2018		340,000	40
2019		254,000	40

Case also had product warranty costs of $98,000 expensed for financial reporting purposes in 2016. For tax purposes, only the $29,000 of warranty costs actually paid in 2016 was deducted. The remaining $69,000 will be deducted for tax purposes when paid over the next three years as follows:

2017	$	23,600	30	%
2018		28,600	40
2019		16,800	40

Pretax accounting income for 2016 was $1,080,000, which includes interest revenue of $28,000 from municipal bonds. The enacted tax rate for 2016 is 30%.