Problem 16-10 (Algo) Net operating loss carryforward; multiple differences; financial statement effects [ LO16-3, 16-5, 16-7] Fore Farms reported a pretax operating loss of $120 million for financial reporting purposes in 2024 . Contributing to the loss were (a) penalty of $12 million assessed by the Environmental Protection Agency for violation of a federal law and paid in 2024 and (b) an estimated loss of $10 million from accruing a loss contingency. The loss will be tax deductible when paid 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. Required: 1. Prepare the journal entry to recognize the income tax benefit of the net operating loss in 2024 . 2. What is the net loss reported in 2024 income statement? 3. Prepare the journal entry to record income taxes in 2025 assuming pretax accounting income is $125 million. No additional temporary differences originate in 2025