The long-term liabilities section of CPS Transportation's December 31, 2020, balance sheet included the following: (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) a. A lease liability with 15 remaining lease payments of $24,000 each, due annually on January 1: Lease liability Less: current portion $182,546 5,745 $176,801 The Incremental borrowing rate at the inception of the lease was 11% and the lessor's Implicit rate, which was known by CPS Transportation, was 10%. b. A deferred Income tax liability due to a single temporary difference. The only difference between CPS Transportation's taxable Income and pretax accounting Income is depreciation on a machine acquired on January 1, 2020, for $420,000. The machine's estimated useful life is five years, with no salvage value. Depreciation is computed using the straight-line method for financial reporting purposes and the MACRS method for tax purposes. Depreciation expense for tax and financial reporting purposes for 2021 through 2024 is as follows: Year MACRS Depreciation Straight-line Depreciation Difference 2021 $120,000 $84,000 $ 36,000 2022 60,000 84,000 (24,000) 2023 50,000 2024 40,000 84,000 84,000 (34,000) (44,000) The enacted federal income tax rates are 20% for 2020 and 25% for 2021 through 2024. CPS had a deferred tax Ilability of $16,500 as of December 31, 2020. For the year ended December 31, 2021, CPS's Income before Income taxes was $820,000. On July 1, 2021, CPS Transportation Issued $520,000 of 9% bonds. The bonds mature in 10 years, and Interest is payable each January 1 and July 1. The bonds were issued at a price to yield the Investors 10%. CPS records Interest at the effective Interest rate. Required: 1. Determine CPS Transportation's income tax expense and net income for the year ended December 31, 2021. 2. Determine CPS Transportation's Interest expense for the year ended December 31, 2021. 3. Prepare the long-term liabilities section of CPS Transportation's December 31, 2021, balance sheet.