L016-2 Temporary Book-Tax Difference Watson Associates purchased $60 thousand of equipment in early January of 2021. Watson estimates the equipment has a useful life of three years, so it depreciates the equipment straight line, with $20 thousand of depreciation expense 2021-2023. However , tax rules allow Watson to take the entire $60 thousand deduction for the cost of the equipment on its 2021 tax return. Watson has a 25% tax rate and pretax accounting income of $100 thousand in each of those years