Marretta Corporation had taxable income and net income per books before federal income taxes in the amounts of $500,000, $700,000 and $850,000 for the taxable years ended December 31, 2019, 2020 and 2021, respectively, prior to the recording of depreciation. On January 1, 2019 Marretta Corporation purchased a fixed asset in the amount of $400,000 with a salvage value of $100,000 and an estimated useful life of 3 years. Marretta Corporation uses straight line depreciation for book purposes and double declining balance at twice the straight-line rate for tax purposes. The different depreciation treatments between book and tax creates a temporary difference.

(a) Calculate the amounts of depreciation (rate rounded to two decimal points) using straight line and double declining balance at twice the straight-line rate for the taxable years ended December 21, 2019, 2020 and 2021, respectively. Show your work.

(b) Prepare the adjusting journal entries to record the depreciation expense for the taxable years ended December 31, 2019, 2020 and 2021, respectively, for the both the straight line and double declining balance at twice the straight-line rate.

(c) Determine the revised book income and taxable income for the taxable years ended December 31, 2019, 2020 and 2021, respectively, now that you have recorded depreciation for book and tax purposes.

(d) Prepare the Adjusting Journal Entry to record Corporate Federal Income Tax Expense for the taxable years ended December 31, 2019, 2020, and 2021, respectively. Assume a 31 corporate federal tax rate.

(e) Prepare a separate Schedule M-1 for the years 2019, 2020 and 2021, respectively.