Figures for Synergetics Company are as follows. 2014.................................$160,000 2015...................................250,000 2016.....................................90,000 2017.................................(160,000) 2018.................................(350,000) 2019...................................120,000 2020...................................100,000 Pretax financial income

Question:

Figures for Synergetics Company are as follows.

2014.................................$160,000

2015...................................250,000

2016.....................................90,000

2017.................................(160,000)

2018.................................(350,000)

2019...................................120,000

2020...................................100,000


Pretax financial income (or loss) and taxable income (loss) were the same for all years involved. Assume a 45% tax rate for 2014 and 2015 and a 40% tax rate for the remaining years.


Instructions

Prepare the journal entries for the years 2016 to 2020 to record income tax expense and the effects of the net operating loss carrybacks and carryforwards, assuming Synergetics Company uses the carryback provision. All income and losses relate to normal operations. (In recording the benefits of a loss carryforward, assume that it is probable the loss carryforward will be realized.)

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Related Book For  book-img-for-question

Intermediate Accounting IFRS

ISBN: 978-1119372936

3rd edition

Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield

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