Seoul, Inc. has the attached items that affect both book income and taxable income for U. S. Federal income tax purposes. REQUIRED: ()Compute the taxable income and financial accounting income (before income taxes) for the years 20X0 through 20X2 What are the permanent and temporary differences for the company? Explain what these terms mean and an example of each for Seo, Inc. in this problem. Complete the table below based upon your answer to (1) above. Show appropriate supporting calculations. Be sure to indicate whether the balance in deferred income taxes is a debit (DR) or credit (CR). (2) (3) SEOUL, INC. TABLE SHOWING INCOME TAX LIABILITY, INCOME TAX EXPENSE, AND ENDING BALANCE IN DEFERRED INCOME TAXES FOR YEARS 20X0 THROUGH 20X1 Income TaxIncome Tax Ending Balance in Deferred Income Taxes Year 20X0 20X1 20X2 Liability Expense (4) Assume that the federal govemment increased the tax rate in 20X1 to 30%. Compute the following items based upon this scenario. (a) Income tax liability for 20X1 and 20X2. (b) Income tax (c) Ending balance in deferred income taxes in 20X1 and 20X2 expense for 20X1 and 20X 2. SEOUL, INC. ITEMS AFFECTING BOOK INCOME AND TAXABLE INCOME FOR YEARS 20X0 THROUGH 20X2 (a) The company purchased a machine at the beginning of 20X0 for $120,000. Management uses straight line depreciation for financial accounting purposes and the sum-of-the-years digits method for tax purposes. The life of the machine is expected to be three years with no estimated salvage value (b) On January 2, 20X0, $210,000 was collected by the company in advance for rental of a building for a three year period. The entire $210,000 was reported as taxable income in 20X0, but $140,000 of the $210,000 was reported as unearned revenue at December 3, 20X0 for book purposes. (c) Interest revenue from the State of Rhode Island bonds is expected to be $10,000 each year until their maturity at the end of 20X2. (d Income before taxes and the above items is $600,000 for 20X0 and 20X1, and $700,000 for 20X2. The company's income tax rate is 25% of taxable income