During 2014, Kate Holmes Co.'s first year of operations, the company reports pretax financial income at $250,000. Holmes's enacted tax rate is 45% for 2014 and 40% for all later years. Holmes expects to have taxable income in each of the next 5 years. The effects on future tax returns of temporary differences existing at December 31, 2014, are summarized as follows.

Instructions
(a) Complete the schedule below to compute deferred taxes at December 31, 2014.
(b) Compute taxable income for 2014.
(c) Prepare the journal entry to record income taxes payable, deferred taxes, and income tax expense for 2014.

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Future Years 2016 Total 2019 2015 2017 2018 Future taxable (deductible) amounts: Installment sales Depreciation Unearned rent $32,000 $32,000 6,000 $32,000 $ 96,000 $6,000 $6,000 (50,000) (50,000) (100,000) Future Taxable (Deductible) Amounts December 31, 2014 Deferred Tax Liability Tax Rate Temporary Difference Installment sales Depreciation Unearned rent (Asset) $ 96,000 30,000 (100,000) Totals ||