Sarah Corp. reported the following differences between statement of financial position carrying amounts and tax bases at December 31, 2013:
Carrying Amount Tax Base
Depreciable assets.............................$125,000............$93,000
Warranty liability (current liability)............18,500.................-0-
Pension liability (long-term liability)..........34,600.................-0-
The differences between the carrying amounts and tax bases were expected to reverse as follows:

Tax rates enacted at December 31, 2013, were 31% for 2013, 30% for 2014, 29% for 2015, and 28% for 2016 and later years.
During 2014, Sarah Corp. made four quarterly tax instalment payments of $8,000 each and reported income before income tax on its income statement of $109,400. Included in this amount were dividends from taxable Canadian corporations of $4,300 (non-taxable income) and $20,000 of expenses related to the executive team's golf dues (non-taxdeductible expenses). There were no changes to the enacted tax rates during the year.
As expected, book depreciation in 2014 exceeded the capital cost allowance claimed for tax purposes by $17,500, and there were no additions or disposals of property, plant, and equipment during the year. A review of the 2014 activity in the warranty liability account in the ledger indicated the following:
Balance, Dec. 31, 2013.................................$18,500
Payments on 2013 product warranties...............(18,900)
Payments on 2014 product warranties.................(5,600)
2014 warranty accrual....................................28,300
Balance, Dec. 31, 2014.................................$22,300
All warranties are valid for one year only. The Pension Liability account reported the following activity:
Balance, Dec. 31, 2013.................$34,600
Payment to pension trustee............(70,000)
2014 pension expense....................59,000
Balance, Dec. 31, 2014................$23,600
Pension expenses are deductible for tax purposes, but only as they are paid to the trustee, not as they are accrued for financial reporting purposes. Sarah Corp. reports under IFRS.
Instructions
(a) Calculate the deferred tax asset or liability account at December 31, 2013, and explain how it should be reported on the December 31, 2013 statement of financial position.
(b) Calculate the deferred tax asset or liability account at December 31, 2014.
(c) Prepare all income tax entries for Sarah Corp. for 2014.
(d) Identify the balances of all income tax accounts at December 31, 2014, and show how they will be reported on the comparative statements of financial position at December 31, 2014, and 2013, and on the income statement for the year ended December 31, 2014.
(e) How would your responses to parts (a) and (d) change if Sarah Corp. followed the ASPE future/deferred income taxes method?

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2014 Depreciable assets Warranty liability Aoxxdion liakbiliiy $17,500 18,500 11,000 2015 $12,500 11,000 After 2015 $2,000 12,600