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Fore Farms reported a pretax operating loss of $ 2 7 6 million for financlal reporting purposes in 2 0 2 4 . Contributing to

Fore Farms reported a pretax operating loss of $276 million for financlal reporting purposes in 2024. Contributing to the loss were (a) a
penalty of $4 million assessed by the Environmental Protection Agency for violation of a federal law and pald in 2024 and (b) an
estimated loss of $30 million from accruling a loss contingency. The loss will be tax deductible when pald in 2025.
The enacted tax rate is 25%. There were no temporary differences at the beginning of the year and none originating in 2024 other
than those described above. Taxable income in Fores's two previous years of operation was as follows:
2022,$124 million
2023,$100 million
Requlred:
Prepare the journal entry to recognize the income tax benefit of the net operating loss in 2024. Assume Fore will carry back its
NOL to prior years.
What is the net operating loss reported in 2024 income statement?
Prepare the journal entry to record income taxes in 2025 assuming pretax accounting income is $296 million. No additional
temporary differences originate in 2025.
Complete this question by entering your answers in the tabs below.
Prepare the journal entry to recognize the income tax benefit of the net operating loss in 2024. Assume Fore will carry back its NOL to
prior years.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in
millions (i.e.,10,000,000 should be entered as 10).
Journal entry worksheet
1
Record 2024 income taxes.
Note: Enter debits before credits.
What is the net operating loss reported in 2024 income statement?
Note: Enter your answer in millions (i.e.,10,000,000 should be entered as 10).
Iournal entry worksheet
1
Record 2025 income taxes.
Note: Enter debits before credits.
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