Burnham company collected rent of $3,800 during year 1. for income tax reporting, the rent is taxed when collected. for financial reporting, the rent is recognized as income in the period earned. at the end of year 1, the unearned portion of the rent collected during the year amounted to $440. burnham had no temporary differences at the beginning of the current year. assume an income tax rate of 30%. what is the amount of the deferred tax asset that should be recognized at the end of year 1?

Brian has just finished college. he wants to set up a small business to make and sell fireworks. he registers his company and acquires a license from the government. he finds that most of his competitors are selling fireworks at an extremely low price. he would like to make more money, so he decides to innovate and develop better fireworks. he sells his fireworks at a higher price, and they are a huge hit with the customers. after a few years, he earns enough profit to set up a bigger fireworks factory that complies with the government’s health and safety regulations. he even starts exporting fireworks overseas. which type of economy does this scenario describe?