For the year ended December 31, 2013, Fidelity Engineering reported pretax accounting income of $977,000. Selected information for 2013 from Fidelitys records follows: Interest income on municipal bonds $32,000 Depreciation claimed on the 2013 tax return in excess of depreciation on the income statement 55,000 Carrying amount of depreciable assets in excess of their tax basis at year-end 85,000 Warranty expense reported on the income statement 26,000 Actual warranty expenditures in 2013 16,000 Fidelitys income tax rate is 40%. At January 1, 2013, Fidelitys records indicated balances of zero and $12,000 in its deferred tax asset and deferred tax liability accounts, respectively. Required: 1. Determine the amounts necessary to record income taxes for 2013 and prepare the appropriate journal entry. 2. What is Fidelitys 2013 net income?