Lindy Corp began operations on January 1, 20x1. During 20x1-20x3 Lindy's book income and tax rates were as follows

	Book Income/Loss	Tax Rate
20x1	$16,000	40%
20x2	(3,000)	30%
20x3	(5,000)	35%

During 20x1-20x3 Lindy's tax income differed from book income for two reasons:

- On January 1, 20x1, Lindy purchased equipment for $24,000. For tax purposes, the equipment was fully deductible in 20x1. For book purposes, the equipment was depreciated over a 4-year life with no salvage value

- Lindy incurred $2,000 of non-deductible fines and penalties in 20x3

Lindy's 20x4 income statement and tax return are presented below

	Income Statement	Tax Return
Revenue	$40,000	$40,000
Interest Revenue	4,000	0
Installment Sales	8,000	2,000
	52,000	42,000
Expenses
Wages	45,000	45,000
Depreciation	6,000	0
Meals & Entertainment	20,000	10,000
	71,000	55,000
Income/(Loss) Before Tax	$(19,000)	$(13,000)

Other Information:

1. Interest revenue is earned on tax-exempt securities

2. Installment sales are accrued for book purposes but taxed when collected. The installment sales will be collected equally over a 4 year period

3. One-half of meals and entertainment costs are not deductible for tax purposes

4. Lindy determined that 25% of net operating loss carryforward would not be utilized. There was no valuation allowance on Dec 31, 20x3. Any net operating loss carryforward is expected to be utilized in 20x8.

5. Lindy carries losses back whenever possible

6. On Jan 1, 20x4, Congress passed a new tax act that phases in lower tax rates. Rates will be reduced as follows

20x4	30%
20x5	25%
20x6 and beyond	20%

A: Prepare a schedule of Lindy Corp's temporary differences and carryforwards and related deferred tax assets and liabilities at Dec 31, 20x4

B: Prepare Lindy Corp's 20x4 tax accrual