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Arndt, Incorporated reported the following for $2024$ and $2025($$ in millions$)$:

$20242025$

Revenues $ $918$ $ $1,010$

Expenses $774830$

Pretax accounting income $($income statement$)$ $ $144$ $ $180$

Taxable income $($tax return$)$ $ $126$ $ $214$

Tax rate: $25\%$

Expenses each year include $$36$ million from a two$-$year casualty insurance policy purchased in $2024$ for $$72$ million. The cost is tax deductible in $2024.$

Expenses include $$2$ million insurance premiums each year for life insurance on key executives.

Arndt sells one$-$year subscriptions to a weekly journal. Subscription sales collected and taxable in $2024$ and $2025$ were $$37$ million and $$53$ million, respectively. Subscriptions included in $2024$ and $2025$ financial reporting revenues were $$31$ million $($$$14$ million collected in $2023$ but not recognized as revenue until $2024)$ and $$37$ million, respectively. Hint: View this as two temporary differences$$one reversing in $2024$; one originating in $2024.$

$2024$ expenses included a $$20$ million unrealized loss from reducing investments $($classified as trading securities$)$ to fair value. The investments were sold and the loss realized in $2025.$

During $2023,$ accounting income included an estimated loss of $$10$ million from having accrued a loss contingency. The loss was paid in $2024,$ at which time it is tax deductible.

At January $1,2024,$ Arndt had a deferred tax asset of $$6$ million and no deferred tax liability.

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