Fox Corporation purchased a machine on January 1, 2020, that cost $40,000. The machine had an estimated service life of five years and no residual value. Fox uses straight line depreciation for accounting purposes and accelerated depreciation for the income tax return as follows: 2020, 30%; 2021, 25%; 2022, 20%; 2023, 15%; and 2024, 10%, Taxable income on the tax return for 2020 was $150,000. The 2020 income statement also showed a $15,000 expense for premiums paid for life insurance policies on company executive officers. The income tax rate is 25% in 2020 and 35% in all subsequent years. a. Prepare a schedule to determine deferred tax balances on December 31, for the years 2020 through 2024. Note: Do not use negative signs with your answers. 2020 2021 2022 2023 2024 OS Equipment, Net GAAP basis $ Tax basis Difference between GAAP and tax bases $ Tax rate 0 $ 0 0 $ 0 0 0 $ 0 0 0 0 0 $ 0 $ 0 OS 35% OS 0 $ 35% 35% 35% 35% 0 $ 0$ 0 $ 0 $ b. Record the income tax journal entry on December 31, 2020. Note: If a line in a journal entry isn't required for the transaction, select "N/A" as the account names and leave the Dr. and Cr. answers blank (zero). Account Name Dr. Cr. Date Dec 31, 2020 0 0 0 0 0 0 0 To record income tax. c. Repeat requirements a and b assuming instead that the machine is 100% expensed in 2020 for tax purposes. a. Prepare a schedule to determine deferred tax balances on December 31, for the years 2020 through 2024. Note: Do not use negative signs with your answers. 2020 2021 2022 2023 2024 Equipment, Net GAAP basis $ 0 $ 0 $ 0 $ 0 $ 0 Tax basis 0 0 0 0 0 Difference between GAAP and tax bases 0 0 0 0 0 Tax rate 35% 35% 35% 35% 135% 0 $ 0 $ 0 $ 0 $ 0 b. Record the income tax journal entry on December 31, 2020. Note: If a line in a journal entry isn't required for the transaction, select "N/A" as the account names and leave the Dr. and Cr. answers blank (zero). Date Account Name Dr. Cr. Dec. 31, 2020 > 0 o 0 0 0 0 To record income tax