Short-Answer Question (20 marks) 1. B-Line Company reported pretax net income from continuing operations of $1,000,000 and taxable income of $800,000. The favorable book-tax difference of $200,000 was due to a $100,000 favorable temporary difference relating to depreciation, an unfavorable temporary difference of $50,000 due to accrued vacation pay, and a $150,000 favorable permanent difference from the dividends received deduction. Required: Based on taxation in the United States of America, a) compute B-Line's current income tax expense. b) compute B-Line's deferred income tax expense or benefit. c) compute B-Line's effective tax rate. d) reconcile B-Line's effective tax rate with its hypothetical tax rate of 21 percent. (2 marks) (2 marks) (2 marks) (1 mark)