Wynn Farms reported a net operating loss of $225,000 for financial reporting and tax purposes in 2021. The enacted tax rate is 25%. Taxable income, tax rates, and income taxes paid in Wynn's first four years of operation were as follows: Income Тахable Таx Таxes Paid $21,900 24,900 58,000 18,000 Income 2017 $ 73,000 2018 Rates 30% 30 83,000 2019 145,000 2020 40 40,000 45 Required: 1. NOL carrybacks are not allowed for most companies, except for property and casualty insurance companies as well as some farm-related businesses. Assume Wynn is one of those businesses. Complete the table given below and prepare the journal entry to recognize the income tax benefit of the net operating loss. 2. Show the lower portion of the 2021 income statement that reports the income tax benefit of the net operating loss. Answer is not complete. Complete this question by entering your answers in the tabs below. Required Required Required 1 1 GJ NOL carrybacks are not allowed for most companies, except for property and casualty insurance companies as well as some farm-related businesses. Assume Wynn is one of those businesses. Complete the following table to recognize the income tax benefit of the net operating loss. (Enter your answers in whole dollars. Leave no cell blank, enter "0" wherever applicable. Enter all amounts as positive values.) Show lessA Operating loss carryback Rate % Tax $ Recorded as: 30% = $ $ $ 45% = Carried back - 2017 Carried back - 2018 30% = 145X x 40X x Carried back - 2019 40% 58 Carried back - 2020 $ 18 Receivable-income tax 76 refund Total carryback $ Operating loss carryforward 185X x Deferred tax asset- ending Carried forward 76%X = $ 141 Required 1 Calculation Required 1 GJ >
Wynn Farms reported a net operating loss of $225,000 for financial reporting and tax purposes in 2021. The enacted tax rate is 25%. Taxable income, tax rates, and income taxes paid in Wynn's first four years of operation were as follows: Income Тахable Таx Таxes Paid $21,900 24,900 58,000 18,000 Income 2017 $ 73,000 2018 Rates 30% 30 83,000 2019 145,000 2020 40 40,000 45 Required: 1. NOL carrybacks are not allowed for most companies, except for property and casualty insurance companies as well as some farm-related businesses. Assume Wynn is one of those businesses. Complete the table given below and prepare the journal entry to recognize the income tax benefit of the net operating loss. 2. Show the lower portion of the 2021 income statement that reports the income tax benefit of the net operating loss. Answer is not complete. Complete this question by entering your answers in the tabs below. Required Required Required 1 1 GJ NOL carrybacks are not allowed for most companies, except for property and casualty insurance companies as well as some farm-related businesses. Assume Wynn is one of those businesses. Complete the following table to recognize the income tax benefit of the net operating loss. (Enter your answers in whole dollars. Leave no cell blank, enter "0" wherever applicable. Enter all amounts as positive values.) Show lessA Operating loss carryback Rate % Tax $ Recorded as: 30% = $ $ $ 45% = Carried back - 2017 Carried back - 2018 30% = 145X x 40X x Carried back - 2019 40% 58 Carried back - 2020 $ 18 Receivable-income tax 76 refund Total carryback $ Operating loss carryforward 185X x Deferred tax asset- ending Carried forward 76%X = $ 141 Required 1 Calculation Required 1 GJ >
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter18: Accounting For Income Taxes
Section: Chapter Questions
Problem 9MC: Brooks Company reported a prior period adjustment of 512,000 in pretax financial "income" and...
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Transcribed Image Text:Wynn Farms reported a net operating loss of $225,000 for financial reporting and tax purposes in 2021. The enacted
tax rate is 25%. Taxable income, tax rates, and income taxes paid in Wynn's first four years of operation were as follows:
Income
Taxable
Income
2017$ 73,000
2018 83,000
2019 145,000
2020
Таx
Таxes
Paid
$21,900
24,900
58,000
18,000
Rates
30%
30
40
40,000
45
Required:
1. NOL carrybacks are not allowed for most companies, except for property and casualty insurance companies as well
as some farm-related businesses. Assume Wynn is one of those businesses. Complete the table given below and
prepare the journal entry to recognize the income tax benefit of the net operating loss.
2. Show the lower portion of the 2021 income statement that reports the income tax benefit of the net operating loss.
X Answer is not complete.
Complete this question by entering your answers in the tabs below.
Required Required Required
1 GJ
1
2
NOL carrybacks are not allowed for most companies, except for property and casualty insurance
companies as well as some farm-related businesses. Assume Wynn is one of those businesses.
Complete the following table to recognize the income tax benefit of the net operating
loss. (Enter your answers in whole dollars. Leave no cell blank, enter "0" wherever applicable.
Enter all amounts as positive values.)
Show lessA
Operating loss
carryback
Rate
Tax $
Recorded as:
%
$
30%
$
30% =
$
$
40%
45% =
Carried back - 2017
Carried back - 2018
145X x
40X x
Carried back - 2019
58
Carried back - 2020
2$
18
Total carryback
$
Receivable-income tax
76
refund
Operating loss carryforward
Deferred tax asset-
|ending
Carried forward
$
185X x
76%X=
$ 141
Required 1 Calculation
Required 1 GJ >
Transcribed Image Text:Required Required Required
1 GJ
2
Show the lower portion of the 2021 income statement that reports the income tax benefit
of the net operating loss. (Amounts to be deducted should be indicated with a minus sign.
Enter your answers in whole dollars.)
Show lessA
(225 X
Operating loss before income taxes (
Income tax benefit:
Tax savings from NOL
carryforward
Tax refund from NOL carryback
10X
76X
86
$
(139)
< Required 1 GJ
Required 2 >
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