Emery Incorporated records included the following data for 2025: a) Emery included $560,000 of gross profit on installment sales on the books. Emery's gross profit from collections of installment receivables was $400,000. b) Life insurance on officers was $5,200. c) The company acquired machinery in January for $240,000. Emery uses straight-line depreciation and the machine had a use life of eight-years (no salvage value) is used. For tax purposes, the company uses MACRS depreciation (17.5% for 2025) d) Received interest on tax exempt Indiana State bonds of $7,600. e) The estimated warranty liability related to 2025 sales was $24,800. Repair costs under warranties during 2025 were $16,800. The remainder will be incurred in 2026. f) Pretax financial income is $900,000. The tax rate is 20%. Instructions 1. Prepare a schedule starting with pretax financial income and compute taxable income. 2. Prepare the journal entry to record income taxes for 2025