Sed TPW. a calendar year taxpayer, sold land with a $616,000 tax basis for $860,000 in February. The purchaser pold $85,000 cash at closing and gave TPW an interest-bearing note for the $774,000 remaining price in August, TPW received a $61,900 payment from the purchaser consisting of a $38.700 principal payment and a $23.200 Interest payment in the first year after the year of sale, TPW received payments totaling $118,800 from the purchaser The total consisted of $77.400 principal payments and 541.400 interest payments Required: a. For the first year after the year of sale, compute the difference between TPWs book and tax income resulting from the Instalment sale method b. Is this difference favorable or unfavorable? c. Using a 21 percent tax rate, determine the effect of the difference on the deferred tax asset or liability generated in the year of sale Complete this question by entering your answers in the tabs below. Required Required Required For the first year after the year of sale, compute the difference between TPW's book and tax income resulting from the installment sale method. (Round gross profit percentage to 2 decimal places and final answer to the nearest whole dollar amount.) Boots are Required B Prov 1 of 3 Next > MacBook Pro C Q Search or enter address E 2 3 $ 4 % 5 6 & 7 8 9 R W E R T Y U S D F. G H TPW, a calendar year taxpayer, sold land with a $616,000 tax basis for $860,000 in February. The purchaser paid $86,000 cash at closing and gave TPW an interest-bearing note for the $774,000 remaining price. In August, TPW received a $61,900 payment from the purchaser consisting of a $38,700 principal payment and a $23,200 interest payment. In the first year after the year of sale, TPW received payments totaling $118,800 from the purchaser. The total consisted of $77,400 principal payments and $41,400 Interest payments Required: a. For the first year after the year of sale, compute the difference between TPW's book and tax Income resulting from the installment sale method b. Is this difference favorable or unfavorable? c. Using a 21 percent tax rate, determine the effect of the difference on the deferred tax asset or liability generated in the year of sale. Complete this question by entering your answers in the tabs below. Required A Required 8 Required Is this difference favorable or unfavorable? Favorable unfavorable