Alvis Corporation reports pretax accounting income of $400,000, but due to a single temporary difference, taxable income

Question:

Alvis reports pretax accounting income of $400,000, but due to a single temporary difference, taxable income is only $250,000. At the beginning of the year, no temporary differences existed.

Required:
1. Assuming a tax rate of 35%, what will be Alvis's net income?
2. What will Alvis report in the pertaining to income taxes?

Balance Sheet
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