Required information Problem 16-8 (Algo) Multiple differences; taxable income given; two years; change in tax rate; financial statement effects [LO16-1, 16-2, 16-3, 16-5, 16-6, 16-8] [The following information applies to the questions displayed below.] Arndt, Incorporated reported the following for 2024 and 2025 (\$ in millions): a. Expenses each year include $60 million from a two-year casualty insurance policy purchased in 2024 for $120 million. The cost is tax deductible in 2024 . b. Expenses include $2 million insurance premiums each year for life insurance on key executives. c. Arndt sells one-year subscriptions to a weekly journal. Subscription sales collected and taxable in 2024 and 2025 were $61 million and $77 million, respectively. Subscriptions included in 2024 and 2025 financial reporting revenues were $55 million ( $38 million collected in 2023 but not recognized as revenue until 2024) and $61 million, respectively. Hint View this as two temporary differences-one reversing in 2024; one originating in 2024. d. 2024 expenses included a $44 million unrealized loss from reducing investments (classified as trading securities) to fair value. The investments were sold and the loss realized in 2025 . e. During 2023, accounting income included an estimated loss of $34 million from having accrued a loss contingency. The loss was paid in 2024 , at which time it is tax deductible. f. At January 1, 2024, Arndt had a deferred tax asset of $18 million and no deferred tax liability. Problem 16-8 Part 2 2. Prepare a schedule that reconciles the difference between pretax accounting income and taxable income. Using the schedule, prepare the necessary journal entry 2. Prepare a schedule that reconciles the difference between pretax accounting income and taxable income. Using the schedule, prepare the necessary journal entry to record income taxes for 2024 . Complete this question by entering your answers in the tabs below. Prepare a schedule that reconciles the difference between pretax accounting income and ta Note: Amounts to be deducted should be indicated with a minus sign. Enter your answers i place (i.e., 5,500,000 should be entered as 5.5). $34 million from having accrued a loss contingency. The loss was paid in 2024 , at which time it is tax deductible. f. At January 1, 2024, Arndt had a deferred tax asset of $18 million and no deferred tax liability. Problem 16-8 Part 3 3. Compute the deferred tax amounts that should be reported on the 2024 balance sheet. Note: Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5)