MNs compensation package for its PEO consisted of a $600,000 salary plus $200,000 unfunded deferred compensation. The PEO will receive the $200,000 when he retires in 2026. He is also a participant in MNs qualified pension plan. MN contributed $21,000 to fund a $90,000 annual pension that the PEO will begin to receive in 2026.

Required:

Compute MN's current year financial statement expense for the PEOs compensation.

Compute MN's current year tax deduction for the PEOs compensation.

Compute the PEOs current year taxable compensation income.

How much taxable income will the PEO recognize in 2026?