During 2021, its first year of operations, Jim's Steel Corporation reported a net operating loss of $312,000 for financial reporting and tax purposes. The enacted tax rate is 25%.

Required:

[1] Prepare the journal entry to recognize the income tax benefit of the net operating loss. Assume the weight of available evidence suggests that future taxable income will be sufficient to benefit from future deductible amounts arising from the net operating loss carryforward.

[2] In 2022, Jim's generated taxable income of $200,000. How much of the net operating loss carryforward, from 2021, can be used to reduce 2022 taxable income?