TPW, a calendar year taxpayer, sold land with a $551,000 tax basis for...
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TPW, a calendar year taxpayer, sold land with a $551,000 tax basis for $830,000 in February. The purchaser paid $91,000 cash at closing and gave TPW an interest-bearing note for the $739,000 remaining price. In August, TPW received a $61,250 payment from the purchaser consisting of a $36,950 principal payment and a $24,300 interest payment. Assume that TPW uses the installment sale method of accounting. Required: a. Compute the difference between TPW's book and tax income resulting from the installment sale method. b. Is this difference favorable or unfavorable? c. Using a 21 percent tax rate, compute PTR's deferred tax asset or liability (identify which) resulting from the book/tax difference. Complete this question by entering your answers in the tabs below. Required A Required B Required C Compute the difference between TPW's book and tax income resulting from the installment sale method. (Round gross profit percentage to 2 decimal places, and intermediate calculations to the nearest whole dollar amount. Round your final answer to nearest whole dollar amount.) Book/tax difference Required A Required B >
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