Problem 3 Deferred Income Taxes (20 points) Part 1: With regard to deferred taxes and income tax timing differences, please explain what a deferred tax balance in the liabilities section of the balance sheet indicates. Part 2: The following facts relate to Coop Corporation: 1. Deferred tax asset, January 1, 220, $58,000 2. Taxable income for V20, $180,000 3. Cumulative temporary differences at December 31, 720 giving rise to future deductible amounts $360,000 4. Cumulative temporary differences at December 31, 720 giving rise to future taxable amounts $63,000 5. Tax rate for all years is 22% Required: a. Compute taxes payable for Y20 b. What is the balance in deferred income taxes at 12/31/20 and is it an asset or a liability? c. Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for Y20. a., b (c) Debit Credit