TPW$,$ a calendar year taxpayer, sold land with a $$535,000$ tax basis for $$750,000$ in February. The purchaser paid $$75,000$ cash at closing and gave TPW an interest$-$bearing note for the $$675,000$ remaining price. In August, TPW received a $$55,950$ payment from the purchaser consisting of a $$33,750$ principal payment and a $$22,200$ interest payment. In the first year after the year of sale, TPW received payments totaling $$106,900$ from the purchaser. The total consisted of $$67,500$ principal payments and $$39,400$ 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.