Notes from Workpaper Review Aldridge uses U$.$S$.$ GAAP and has a tax rate of $30\%$ in Year $1.$ During Year $2$ the tax rate was increased to $35\%$ for Year $2$ and beyond. On the liability side, it had income tax payable of $$35,500$ in Year $1$ and an estimated $$28,900$ in Year $2.$ Year $1$: MarLife Co$.$ life insurance policy on Chief Operating Officer where Aldridge is sole beneficiary paid out $$200,000$ to Aldridge. Advance royalties received of $$50,000$ for anticipated sales during Year $2.$ Different depreciation methods used$-$financial statement depreciation is straight$-$ line, $$35,000,$ and tax depreciation is accelerated, $$52,000.$ Records show a $$1,000$ fine paid to the IRS for failure to provide required paperwork. Bad debt expense booked on receivables of $$25,000.$ Next Steps: Evaluate differences to determine whether DTA or DTL is appropriate; prepare Year $1$ and $2$ related journal entries for comparison to Aldridge general ledger. Scroll down to complete all parts of this task. Kent Wesley is a junior member of the external audit team hired to audit Aldridge Inc.$\text{'}$s Year $2$ financial statements. Kent has been tasked with reviewing differences related to Aldridge's financial statements versus its tax forms from Year $1$ in order to prepare for the Year $2$ audit. After reading through the workpapers gathered from the company's financial reporting group, Wesley prepares notes shown in the exhibit to discuss with his manager.$$ Use the information contained in the exhibit to fill out the tables below. Select the answers from the option lists provided. $1.$ For each of the items listed above, populate the table below: ABC$1$ Item Temporary or Permanent Difference Deferred Tax Asset $($DTA$)$ or Deferred Tax Liability $($DTL$)2$ Depreciation $3$ Life insurance payout $4$ Fine to the IRS $5$ Royalties received $6$ Bad debt expense $2.$ What is the journal entry associated with the transactions above for Year $1?$ Account Name Debit Credit Income Tax Expense Change in DTA Change in DTL Income Tax Payable $3.$ What is the journal entry associated with the transactions above for Year $2?$ Account Name Debit Credit Income Tax Expense Change in DTA Change in DTL Income Tax Payable