$1.$ The records for Dulcinea Co show this data for $2023$:

i$.$ $$600,000$ was collected from customers in $2023,$ but only $$500,000$ was earned according to GAAP.

ii$.$ Life insurance premium paid on officers was $$3,500($Company is beneficiary$).$

iii. Machinery was acquired in January for $$350,000.$ Straight$-$line depreciation over a ten$-$year life $($no salvage value$)$ is used. For tax purposes, MACRS depreciation is used and Dulcinea may deduct $14\%$ for $2023.$

iv$.$ Interest received on tax exempt Kansas State bonds was $$10,000.$

v$.$ $$55,000$ was accrued as estimated litigation expenses. It will not be paid until the lawsuit is finalized.

vi$.$ Pretax financial income is $$600,000.$ The tax rate is $30\%.$

Required:

a$.$ Prepare a schedule starting with pretax financial income and compute taxable income.

b$.$ Prepare the journal entry to record Income Taxes for $2023.$