P19.2 (LO 1, 2) (One Temporary Difference, Tracked for 4 Years, One Permanent Difference, Change in Rate) The pretax financial income of Truttman Company differs from its taxable income throughout each of 4 years as follows. Year Pretax Financial Taxable Tax Income Income Rate 2020 $290,000 $180,000 35% 2021 320,000 225,000 20 2022 350,000 260,000 20 2023 420,000 560,000 20 Pretax financial income for each year includes a nondeductible expense of $30,000 (never deductible for tax purposes). The remainder of the difference between pretax financial income and taxable income in each period is due to one depreciation temporary difference. No deferred income taxes existed at the beginning of 2020. Instructions a. Prepare journal entries to record income taxes in all 4 years. Assume that the change in the tax rate to 20% was not enacted until the beginning of 2021. b. Prepare the income statement for 2021, beginning with Income before income taxes. P19.3 (LO 1 2 4 /Socon