Corporation VB€™s tax returns for 2012, 2013, and 2014 provide the following information:

a. On the basis of the above data, did VB derive any tax benefit from its 2012 NOL? Explain your conclusions.
b. VB generated a $350,000 net operating loss for 2015. It projects that it will continue to operate at a loss through 2016 but should generate at least $1 million taxable income in 2017. On the basis of this projection, compute the net present value of the tax savings from VB€™s deduction of the 2015 NOL, assuming that VB deducts it as a carryback and carryforward to the extent possible. In making your calculations, refer to the corporate tax rate schedule to compute VB€™s tax in 2013 and 2014 and use a 5 percent discount rate to compute NPV.
c. Should VB elect to give up the carryback of its 2015 NOL and use the entire NOL as a carryforward deduction? Support your conclusion with calculations.

2012 2013 2014 $150,000 $1,890,000 $7,810,000 Gross income Deductions 190,000(1830,000) 17 700,000) (40,000 $ 60,000 110,000 Taxable income or (NOL)