Primrose co. uses the deffered method for inter period taxallocation. Primrose reports deperation expense for machinery purchases for thecurrent year using the modified accelerated cost recovery system for income taxpurpose and the straight line basis forfinancial reporting. The tax deduction is the larger amount this year. Primrosealso received rent revenues in advance this year.it inculeded these revenues inthis years tax able income. For financial reporting, rent revenue are reportedas unearned revenue, a current liability.

required: a) what is the conceptual underpinning for deferred income taxes? (b)how does primrose determine and account for the income tax effect for both depreciation and rent? explain (c) how does primrose classify the income tax effect of both deperatation and rent on its balance sheet and income statement?explain