Comprehensive Problem $16-64($LO $16-1,$ LO $16-2,$ LO $16-3)($Algo$)$

Timpanogos Incorporated is an accrual$-$method, calendar$-$year corporation. For $2023,$ it reported financial statement

income after taxes of $$1,504,600.$ Timpanogos provided the following information relating to its activities for the year:

Life insurance proceeds as a result of CEO's death

Revenue from sales $($for both book and tax purposes$)$

Premiums paid on the key$-$person life insurance policies. The policies have no

cash surrender value.

Charitable contributions

Cost of goods sold for book and tax purposes

Interest income on tax$-$exempt bonds

Interest paid on loan obtained to purchase tax$-$exempt bonds

Rental income payments received and earned in $2023$

Rental income payments received in $2022$ but earned in $2023$

Rental income payments received in $2023$ but not earned by year$-$end

Tax depreciation

Book Depreciation

Net capital loss

Federal income tax expense for books

$$224,000$

$2,240,000$

$23,400$

$201,600$

$336,000$

$44,800$

$50,400$

$17,400$

$11,200$

$33,600$

$61,000$

$27,400$

$46,800$

$347,200$

Required:

a$.$ Reconcile book income to taxable income for Timpanogos Incorporated. Be sure to start with book income and

identify all of the adjustments necessary to arrive at taxable income.

b$.$ Identify each book$-$tax difference as either permanent $(P)$ or temporary $(T).$

c$.$ Complete Schedule M$-1$ for Timpanogos.

d$.$ Compute Timpanogos Incorporated's tax liability.

Complete this question by entering your answers in the tabs below.

Compute Timpanogos Incorporated's tax liability.

Tax liability