Wise Company began operations at the beginning of 2015. The following information pertains to this company.

1.		Pretax financial income for 2015 is $100,000.
2.		The tax rate enacted for 2015 and future years is 40%.
3.		Differences between the 2015 income statement and tax return are listed below:
		(a)		Warranty expense accrued for financial reporting purposes amounts to $7,000. Warranty deductions per the tax return amount to $2,000.
		(b)		Gross profit on construction contracts using the percentage-of-completion method per books amounts to $92,000. Gross profit on construction contracts for tax purposes amounts to $67,000.
		(c)		Depreciation of property, plant, and equipment for financial reporting purposes amounts to $60,000. Depreciation of these assets amounts to $80,000 for the tax return.
		(d)		A $3,500 fine paid for violation of pollution laws was deducted in computing pretax financial income.
		(e)		Interest revenue recognized on an investment in tax-exempt municipal bonds amounts to $1,500.
				(Assume (a) is short-term in nature; assume (b) and (c) are long-term in nature.)
4.		Taxable income is expected for the next few years compute taxable income for 2015