Olong Ltd. started operations in 20X6. The company provided the following information for its warranty balances for the past four years:

20X620X720X820X9Warranty costs accrued$34,000 $29,000 $32,000 $49,000 Costs incurredwarranty work 27,000 22,000 39,000 32,000 Costs incurreddevelopment costs 54,000 59,000 69,000 34,000 Amortizationdevelopment costs 0 9,000 23,500 34,000 Tax rate 40% 38% 38% 36%

Required: 1. What is the tax basis for development costs and the provision for warranty costs in each year? (Leave no cells blank - be certain to enter "0" wherever required.)

2. What is the accounting basis for development costs and the provision for warranty costs in each year? (Amounts to be deducted should be indicated with a minus sign.)

3. What is the deferred tax balance in each year? (Amounts to be deducted should be indicated with a minus sign.)

4. Is the deferred tax balance an asset or a liability?