Net operating loss carryback and carryforward Q2. Wynn Sheet Metal reported a net operating loss of $180,000 for financial reporting and tax purposes in 2016. The enacted tax rate is 40%. Taxable income tax rates, and income taxes paid in Wynn's first four years of operation were as follows: Taxable income Tax Rates Income Taxes Paid 2012 $70,000 30% $21,000 2013 $80,000 30% $24,000 2014 $90,000 40% $36,000 2015 $70,000 45% $31,500 Required: 1. Prepare the journal entry to recognize the income tax benefit of the net operating loss. Wynn elects the carryback option. 2. Show the lower portion of the 2016 income statement that reports the income tax benefit of the net operating loss