Tru Developers, Inc., sells plots of land for Industrial development. Tru recognizes income for financial reporting purposes in the year it sells the plots. For some of the plots sold this year, Tru took the position that it could recognize the income for tax purposes when the Installments are collected. Income that Tru recognized for financial reporting purposes in 2018 for plots in this category was $70 million. The company expected to collect 60% of each sale in 2019 and 40% in 2020. This amount over the next two years is as follows: 2019 2020 $ 42 million 28 million $ 70 million Tru's pretax accounting income for 2018 was $95 million. In its income statement. Tru reported interest income of $10 million, unrelated to the land sales, for which the company's position is that the interest is not taxable. Accordingly, the interest was not reported on the tax return. There are no differences between accounting income and taxable income other than those described above. The enacted tax rate is 40 percent Management believes the tax position taken on the land sales has a greater than 50% chance of being upheld based on its technical merits, but the position taken on the interest has a less than 50% chance of being upheld. It is further beloved that the following likelihood percentages apply to the tax treatment of the land sales ($ colons) Amount Qualifying for Pecinta Cikelthood of Installment Sales Treatment Tax Treatment Blog sustained 203 5.70 60 50 40 30 203 2014 20% 203 Required: Required: 1. What portion of the tax benefit of tax-free interest will Tru recognize on its 2018 tax return? 2. What portion of the tax benefit of tax-free interest will Tru recognize on its 2018 financial statements? 3-6. What portion of the tax on the $70 million income from the plots sold on an installment basis will Tru defer on its 2018 tax return? 3-b. What portion of the tax on the $70 million income from the plots sold on an installment basis will Tru defer in its 2018 financial statements? 4. Prepare the journal entry to record income taxes in 2018 assuming full recognition of the tax benefits in the financial statements of 5. Prepare the journal entry to record income taxes in 2018 assuming the recognition of the tax benefits in the financial statements you Indicated in requirements 1-3. Complete this question by entering your answers in the tabs below. Req 1 to 3 Reg 4 Reg 5 What portion of the tax benefit of tax-free interest will Tru recognize on its 2018 tax return and financial statements? What portion of the tax on the $70 million Income from the plots sold on an installment basis will Tru defer on its 2018 tax return and financial statements? 1 Tax benefit recognized 2 Tax benefit recognized Sa Amount deferred 36 milion million million million Read