Question: Blossom Corporation purchased a machine on January 2, 2020, for $5000000. The machine has an estimated 5-year life with no salvage value. The straight-line method

Blossom Corporation purchased a machine on January 2, 2020, for $5000000. The machine has an estimated 5-year life with no salvage value. The straight-line method of depreciation is being used for financial statement purposes and the following MACRS amounts will be deducted for tax purposes:

2020 $1000000 2023 $575000
2021 1600000 2024 575000
2022 960000 2025 290000

Assuming an income tax rate of 20% for all years, the net deferred tax liability that should be reflected on Blossom's balance sheet at December 31, 2021 be

$85000

$8000

$0

$120000

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