You have been assigned to compute the income tax provision for Tulip City Flowers, Inc. (TCF) as of December 31, 2020. The company’s Income Statement for 2020 is provided below:

Tulip City Flowers, Inc.
Statement of Operations
					at December 31, 2020
Net sales					$20,000,000
Cost of sales					12,000,000
Gross profit					8,000,000
Compensation					500,000
Selling expenses					750,000
Depreciation and amortization					1,250,000
Other expenses					1,000,000
Total operating expenses					3,500,000
Income from operations					$4,500,000
Interest and other income					25,000
Income before income taxes					$4,525,000

You have identified the following permanent differences:

 Interest income from municipal bonds: $10,000

 Nondeductible stock compensation: $5,000

 Nondeductible fines: $1,000

TCF prepared the following schedule of temporary differences from the beginning of the year to the end of the year: 

Tulip City Flowers, Inc.
Temporary Difference Scheduling Template
		Beginning	Current	EOY	Ending
Taxable		Deferred	Year	Cumulative	Deferred
Temporary Differences		Taxes	Change	T/D	Taxes
Accumulated depreciation		(1,050,000)	(500,000)	(5,500,000)	(1,155,000)

		Beginning	Current	EOY	Ending
Deductible		Deferred	Year	Cumulative	Deferred
Temporary Differences		Taxes	Change	T/D	Taxes
Allowance for bad debts		21,000	10,000	110,000	23,100
Prepaid income		0	20,000	20,000	4,200
Deferred compensation		10,500	10,000	60,000	12,600
Accrued pension liabilities		105,000	100,000	600,000	126,000
Total		136,500	140,000	790,000	165,900

a. Compute TCF’s current income tax expense or benefit for 2020.

b. Compute TCF’s deferred income tax expense or benefit for 2020.

c. Prepare a reconciliation of TCF’s total income tax provision with its hypothetical income tax expense of 21 percent in both dollars and rates.