30% EX. 2 The pretax accounting income and taxable income of XYZ Corp. were the same for each of the following years. No temporary or permanent differences exist. Income Enacted Rates Year 1 8,000 30% Year 2 10,000 30% Year 3 (current year) (100,000) Year 4 (next year-expected) 20,000 40% Year 5 & forward 40% Note: Assume that it is more likely than not that XYZ will not realize the entire NOL carryforward in future years. Required: (a) Prepare the journal entries for years 3 and 4 to record income tax expense (benefit) and income taxes payable, and the tax effects of the loss carry forward. (6) Prepare the income tax section of the Year 3 Income Statement beginning with the line "Operating loss before income taxes". (c) Prepare the income tax section of the Year 4 Income Statement beginning with the line "Income before income taxes". 0