Chapter 16 Homework Help Arndt, Inc., reported the following for 2018 and 2019 ($ in millions): Revenues Expenses etax accounting income income statenent) Taxable income (tax return) Tax rate: 484 2018 5 865 762 S 103 $ 100 2019 $ 996 882 194 $ 210 eBook a. Expenses each year include $20 million from a two-year casualty Insurance policy purchased in 2018 for $40 million The cost is tax deductible in 2018. b. Expenses include $1 million insurance premiums each year for life insurance on key executives. C. Arndt sells one-year subscriptions to a weekly journal. Subscription sales collected and taxable in 2018 and 2019 were $25 million and $31 million, respectively. Subscriptions included in 2018 and 2019 financial reporting revenues were $17 million ($6 million collected in 2017 but not recognized as revenue until 2018) and $25 million, respectively. Hint: View this as two temporary differences-one reversing in 2018; one originating in 2018. d. 2018 expenses included a $11 million unrealized loss from reducing Investments (classified as trading securities) to fair value. The investments were sold in 2019. e. During 2017, accounting income included an estimated loss of $3 million from having accrued a loss contingency. The loss was paid in 2018 at which time it is tax deductible. f At January 1, 2018, Arndt had a deferred tax asset of $4 million and no deferred tax liability o References Required: 1. Which of the five differences described are temporary and which are permanent differences? Difference Life insurance premiums Casualty insurance expense Unrealized loss Subscriptions received Loss contingency