Krasco Inc.'s auditors prepared the following reconciliation between book and taxable income. The corporation has a 34% tax rate.

Book income before tax	$	8,288,900
Net permanent differences		(35,770	)
Net temporary differences		112,400
Taxable income	$	8,365,530

Compute Krasco's tax expense per books and tax payable.

Compute Krasco's net increase in deferred tax assets or deferred tax liabilities (identify which) for the year.