Required information The following information applies to the questions displayed below) What book-tax differences in year 1 and year 2 associated with its capital gains and losses would DEF Incorporated report in the following alternative scenarios? Identify each book-tax difference as favorable or unfavorable and as permanent or temporary. (Leave no answer blank. Enter zero if applicable and select "Not applicable" if no effect.) a. In year 1. DEF recognized a loss of $15,000 on tand that it had held for investment. In year 1, it also recognized a $30,000 gain on equipment it had purchased a few years ago. The equipment sold for $50,000 and had an adjusted basis of $20,000. DEF had deducted $40,000 of depreciation on the equipment. In year 2. DEF recognized a capital loss of $2,000 book.com Ditorence Favorable or Unfavorable Temporary of Permanent Year 1 Year 2 Required information (The following information applies to the questions displayed below.) What book-tax differences in year 1 and year 2 associated with its capital gains and losses would DEF Incorporated report in the following alternative scenarios? Identify each book-tax difference as favorable or unfavorable and as permanent or temporary. (Leave no answer blank. Enter zero if applicable and select "Not applicable" if no effect.) b. In year 1, DEF recognized a loss of $15,000 on land that it had held for investment. It also recognized a $20,000 gain on equipment it had purchased a few years ago. The equipment sold for $50,000 and had an adjusted basis of $30,000 DEF had deducted $15,000 of tax depreciation on the equipment. There were no capital asset transactions in year 2 Book-tax Difference Favorable or Unfavorable Temporary or Permanent Year 1 Year 2