Question
Oak Inc. reports the following pre-tax incomes (losses) for both book and tax purposes. (Assume that the carryback provision is used where possible.) Year Accounting
Oak Inc. reports the following pre-tax incomes (losses) for both book and tax purposes. (Assume that the carryback provision is used where possible.)
Year | Accounting Income (loss) | Tax rate |
2019 | $50,000 | 30% |
2020 | 140,000 | 35% |
2021 | (250,000) | 35% |
2022 | 70,000 | 35% |
Part A. ( 8 marks). Prepare the journal entries for each of the years 2021 and 2022 to record income taxes, assuming that at December 31, 2021 that it was more likely than not that the company would be able to benefit from the remaining losses available to carry forward.
2021 | Debit | Credit |
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2022 |
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Part B (1 mark). What is the amount that Oak corporation report as net income (loss) for financial reporting purposes in 2021?__________________________
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