At the beginning of 2016, Norris Company had a deferred tax liability of $6,600, because of the use of MACRS depreciatio

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At the beginning of 2016, Norris Company had a deferred taxliability of $6,600, because of the use of MACRS depreciation forincome tax purposes and units-of-production depreciation forfinancial reporting. The income tax rate is 30% for 2015 and 2016,but in 2015 Congress enacted a 39% tax rate for 2017 and futureyears. Norris’s accounting records show the following pretax itemsof financial income for 2016: income from continuing operations,$120,000 (revenues of $353,200 and expenses of $233,200); gain ondisposal of Division F, $21,100; loss from operations ofdiscontinued Division F, $10,800; and prior period adjustment,$16,900, due to an error that understated revenue in 2015. All ofthese items are taxable; however, financial depreciation for 2016on assets related to continuing operations exceeds tax depreciationby $4,400. Norris had a retained earnings balance of $159,100 onJanuary 1, 2016, and declared and paid cash dividends of $32,400during 2016.