Question 3 (19 marks) Pitman Company began operations in 2019. The following information pertains to this company for the year 2019: (1) Pretax financial income for 2019 was $90,000. (2) The tax rate enacted for 2019 and future years is 30%. (3) Differences between the 2019 income statement and tax return are listed below: (i) Fines of $70,000 had been paid during the year resulting from a violation of law. This was not deductible for tax purpose. (ii) Insurance expense of $ $15,000 was prepaid on 1 January 2019. The amount paid is to be recognized equally in 2019, 2020 and 2021 for financial accounting purpose but all of the $15,000 was recognized in 2019 for tax purpose. (iii) An asset with a three-year useful life was acquired in year 2019. It is depreciated by the straight-line method on the income statement. Deductions for depreciation in the tax return are more than straight-line depreciation in the first year but less than straight-line depreciation in the next two years: Year Income Statement Tax Return 2019 $200,000 $400,000 2020 200,000 100,000 2021 200,000 100,000 (iv) In January 2019, rental revenue of $120,000 was collected in advance for a two year period. The entire amount of $120,000 was reported as taxable income in 2019, but half of the total amount was reported as unearned rent revenue at 31 December 2019 for financial reporting purposes. Required: (a) Compute the taxable income for 2019 and prepare the journal entry to record the income taxes for year 2019. (b) What was Pitman Company's 2019 net income? (c) Show how any deferred tax amount(s) should be reported on the (13 marks) (3 marks) 3 statement of financial position as at 31 December 2019