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Part 2: Flynn, Inc. has two temporary differences at the end of 20X2. The first difference stems from installment sales, and the second one results from the accrual of a loss contingency that was recognized fully in 20X2's pre-tax GAAP income. Flynn's accounting department has developed a schedule of future taxable and deductible amounts related to these temporary differences as follows: Part 2 (continued) ---- Future Taxable ' mounts -Installment ales $ 40,000 $ 50,000 $ 60,000 $ 90,000 Future Deductible Amounts i Contingency $05,000) $09,000) As of the beginning of 20X2, the enacted tax rate is 34% for 20x2, and 38% for 20X3-20X6. At the beginning of 20x2, the company had no deferred income taxes on its balance sheet. Taxable income for 20X2 is $400,000. Taxable income is expected in all future years. GAAP pretax income for 20X3 is $10,000. In addition, in 20X3, the company paid nes/penalties of $3,000 for late ling of its payroll taxes. Required: (a) Prepare journal entries to record income taxes in 20X2 and 20x3. (b) Prepare the income statement for 20X2 and 20x3, beginnin with Income before income taxes. You will need to calculate income before income taxes for 20X2 since pre-tax GAAP income was not given. Do not assume that it is the same as taxable income