Income from continuing operations before tax 455

Loss on discontinued operation (pretax) 112

Temporary differences (all related to operating income):
Accrued warranty expense in excess of expense 85
included in operating income
Depreciation deducted on tax return in excess of 145
depreciation expense
Permanent differences (all related to operating income):
Nondeductible portion of entertainment expense 18

Tax 25%
Income from continuing operations before tax 455
Loss on discontinued operation (pretax) -112
Accrued warranty expense 85
Depreciation expense -145
Nondeductible portion of entertainment expense 18
Taxable Income 301
Tax rate 25%
Income tax payable 75.25