Watson Associates purchases $60,000 of computer equipment in January of 2021. Watson estimates that the computer equipment will have an estimated useful life of three years. For financial reporting purposes, Watson records straight-line depreciation each year of $20,000. For tax purposes, Watson can deduct the entire $60,000 cost of the equipment in 2021. Assume income before tax and depreciation was $120,000 per year. First complete the two tables below. Then please answer the following questions.