You have been assigned to compute the income tax provision for Motown Memories Incorporated (MM) as of December 31, 2021. The companys income statement for 2021 is provided below: (Leave no answer blank. Enter zero if applicable.)

Motown Memories Incorporated Statement of Operations at December 31, 2021
Net sales	$ 50,000,000
Cost of sales	28,000,000
Gross profit	$ 22,000,000
Compensation	$ 2,000,000
Selling expenses	1,500,000
Depreciation and amortization	4,000,000
Other expenses	500,000
Total operating expenses	$ 8,000,000
Income from operations	$ 14,000,000
Interest and other income	1,000,000
Income before income taxes	$ 15,000,000

You identified the following permanent differences:

Interest income from municipal bonds	$ 50,000
Nondeductible entertainment expenses	20,000
Nondeductible fines	5,000

MM prepared the following schedule of temporary differences from the beginning of the year to the end of the year:

Motown Memories Incorporated
Temporary Differences Scheduling Template
Taxable Temporary Differences	BOY Deferred Taxes	Current Year Change	EOY Cumulative T/D	EOY Deferred Taxes
Accumulated depreciation	$ (1,680,000)	$ (1,000,000)	$ (9,000,000)	$ (1,890,000)

Motown Memories Incorporated
Temporary Differences Scheduling Template
Deductible Temporary Differences	BOY Deferred Taxes	Current Year Change	EOY Cumulative T/D	EOY Deferred Taxes
Allowance for bad debts	$ 42,000	$ 50,000	$ 250,000	$ 52,500
Reserve for warranties	21,000	20,000	120,000	25,200
Inventory IRC 263A adjustment	50,400	60,000	300,000	63,000
Deferred compensation	10,500	10,000	60,000	12,600
Accrued pension liabilities	630,000	250,000	3,250,000	682,500
Total	$ 753,900	$ 390,000	$ 3,980,000	$ 835,800

Required:

1. Compute MMs current income tax expense or benefit for 2021.
2. Compute MM's deferred income tax expense or benefit for 2021.
3. Prepare a reconciliation of MMs total income tax provision with its hypothetical income tax expense of 21 percent in both dollars and rates.

a. Compute MMs current income tax expense or benefit for 2021. b. Compute MM's deferred income tax expense or benefit for 2021.

Req C

Prepare a reconciliation of MMs total income tax provision with its hypothetical income tax expense of 21 percent in both dollars and rates. (Amounts to be deducted should be indicated by a minus sign. Round your percentage answers to 2 decimal places. Do not round intermediate values.)

Reconciliation of Effective Tax Rate	Dollars	Percent
Provision at 21%			%
			%
			%
			%
Income tax provision			%