Taylor Company began manufacturing operations on January 2, 20X1. During 20X1 Taylor reported pre-tax book income of $150,000 and had taxable income of $200,000. Taylor had a temporary difference relating to accrued product warranty costs which are expected to be paid as follows:

20X2	$	30,000
20X3	$	15,000
20X4	$	5,000

Income tax expense for 20X1 is:

Multiple Choice

• $45,000.

• $30,700.

• $67,000

• $65,000

There is no given tax rate