Exercise 16-26 (Algo) Net operating loss carryback and carryforward; financial statement effects [LO16-7]

2: Record 2024 income tax benefit from operating loss.

3:

Wynn Farms reported a net operating loss of $195,000 for financial reporting and tax purposes in 2024 . The enacted tax rate is 25%. Taxable income, tax rates, and income taxes paid in Wynn's first four years of operation were as follows: Required: 1. NOL carrybacks are not allowed for most companies, except for property and casualty insurance companies as well as some farm-related businesses. Assume Wynn is one of those businesses. Complete the table given below and prepare the journal entry to recognize the income tax benefit of the net operating loss. 2. Show the lower portion of the 2024 income statement that reports the income tax benefit of the net operating loss. NOL carrybacks are not allowed for most companies, except for property and casualty insurance companies as well as some farmrelated businesses. Assume Wynn is one of those businesses. Complete the following table to recognize the income tax benefit of the net operating loss. Note: Enter your answers in whole dollars. Leave no cell blank, enter "0" wherever applicable. Enter all amounts as positive values. Show the lower portion of the 2024 income statement that reports the income tax benefit of the net operating loss. Note: Amounts to be deducted should be indicated with a minus sign. Enter your answers in whole dollars