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E 19-21 (L03) (Carry back and Carryforward of NOL, No Valuation Account, No Temporary Differences) The pretax finan- cial income (or loss) figures for Jenny
E 19-21 (L03) (Carry back and Carryforward of NOL, No Valuation Account, No Temporary Differences) The pretax finan- cial income (or loss) figures for Jenny Spangler Company are as follows. 2012 2013 2014 2015 2016 2017 2018 $160,000 250,000 80,000 (160,000) (380,000) 120,000 100,000 Pretax financial income or loss and taxable income (loss) were the same for all years involved. Assume a 45% tax rate for 2012 and 2013 and a 40% tax rate for the remaining years. Instructions Prepare the journal entries for the years 2014 to 2018 to record income tax expense and the effects of the net operating loss carry- backs and carryforwards assuming Jenny Spangler Company uses the carryback provision. All income and losses relate to normal perations, (In recording the benefits of a loss carryforward, assume that no valuation account is deemed necessary)
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