6-3: The Income Statement Problem 6-13 Loss Carryback and Carryforward The Bookbinder Company has made $250,000 before taxes during each of the last 15 years, and it expects to make $250,000 a year before taxes in the future. However, in 2015 the firm incurred a loss of $675,000. The firm will claim a tax credit at the time it files its 2015 Income tax return, and it will receive a check from the U.S. Treasury. Show how it calculates this credit, and then indicate the firm's tax liability for each of the next 5 years. Assume a 40% tax rate on all Income to ease the calculations. Enter your answers as positive values. If an amount is zero, enter "O". Prior Years Profit eamed 2013 2014 $ 250000 $ 250000 Carry-back credit $ 250000 $ 250000 Adjusted profit $ $ 0 $ 10000C $ 100000 Tax previously paid (40%) Tax refund: Taxes previously paid $ 100006 $ 100000 Total check from U.S. Treasury $ 475006 b. Firm's tax liability 2016: $ 0 2017: $ 0 2018: $ $ $ $ $ o $ 2019: $ 0 2020: $ 25000 6-3: The Income Statement Problem 6-13 Loss Carryback and Carryforward The Bookbinder Company has made $250,000 before taxes during each of the last 15 years, and it expects to make $250,000 a year before taxes in the future. However, in 2015 the firm incurred a loss of $675,000. The firm will claim a tax credit at the time it files its 2015 income tax return, and it will receive a check from the U.S. Treasury. Show how it calculates this credit, and then indicate the firm's tax liability for each of the next 5 years. Assume a 40% tax rate on all Income to ease the calculations. Enter your answers as positive values. If an amount is zero, enter "O". a. 2013 2014 Prior Years Profit earned Carry-back credit $ 25000 $ 25000 $ 250000 $ 25000 Adjusted profit $ 0 0 $ 10000 $ 10000 Tax previously paid (40%) Tax refund: Taxes previously paid $ 10000 $ 10000 Total check from U.S. Treasury s b. Firm's tax liability 2016: $ 2017: $ 2018: 3 3 3 3 $ 2019: $ 2020: $ Show All