***ANSWERS MUST SHOW UP TO TWO DECIMAL POINTS***

Exercise 16-2 (Algo) Determine taxable income; determine prior year deferred tax amount [L016-2] On January 1, 2018, Ameen Company purchased major pieces of manufacturing equipment for a total of $54 million. Ameen uses straight-line depreciation for financial statement reporting and MACRS for income tax reporting. At December 31, 2020, the book value of the equipment was $48 million and its tax basis was $38 million. At December 31, 2021, the book value of the equipment was $46 million and its tax basis was $31 million. There were no other temporary differences and no permanent differences. Pretax accounting income for 2021 was $35 million. Required: 1. Prepare the appropriate journal entry to record Ameen's 2021 income taxes. Assume an income tax rate of 25%. 2. What is Ameen's 2021 net income