Sandhill Co. at the end of 2025, its first year of operations, prepared a reconciliation between pretax financial income and taxable income as follows: Pretax financial income $415,000 Extra depreciation taken for tax purposes (1,017,000) Estimated litigation expenses deductible for taxes when paid 885,000 Taxable income $283,000 Use of the depreciable assets will result in taxable amounts of $339,000 in each of the next three years. The estimated litigation expenses of $885,000 will be deductible in 2028 when settlement is expected. Prepare a schedule of future taxable and deductible amounts. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Future taxable (deductible) amounts 2026 2027 2028

Extra depreciation

Litigation