In 2014, due to an intentional adulteration of its fields by a large pesticide company, Herbivore Organix reported an operating loss of $188,000 for financial reporting and tax purposes. The enacted tax rate is 39%. Taxable income, tax rates, and income taxes paid in Herbivore's first four years of operation were as follows: Taxable Income $62,000 75,000 87,000 89,000 Tax Rates 35% 36 38 Income Taxes Paid $ 21,700 27,000 33,060 32,930 2010 2011 2012 2013 37 Required: 1. Prepare the journal entry to recognize the income tax benefit of the operating loss. Herbivore elects the carryback option. 2. Compute Herbivore's net loss for 2014.