This year, a company has each of the following income statementitems:
- Gross profits on installment sales.
- Revenues on long-term construction contracts.
- Estimated costs of product warranty contracts.
- Premiums on officers’ life insurance policies with the companyas beneficiary.
Indicate where deferred income taxes are reported in thefinancial statements. Specify when deferred income taxes would needto be recognized for each of the items above, and indicate therationale for such recognition.
