When book-tax difference in year 1 and year 2 associated with its capital gains and losses would ABD Inc. report in the following alternative scenarios? Identify each book-tax difference as favorable or unfavorable and permanent or temporary.(Leave no answer blank. Enter zero if applicable.)

a.

Year 1 Year 2

Capital gains $20,000 $5,000

Capital losses 8,000 0

Book-tax difference Favorable or Unfavorable Temporal or Permanent

Year 1

Year 2