Question 1: Lindemax Inc. reports the following pretax income (loss) for both financial reporting purposes and tax purposes. (Assume the carryback provision is used for a net operating loss.) Year Pretax Income (Loss) Tax Rate 2018 220,000 34% 2019 180,000 34% 2020 (520,000) 38% 2021 440,000 38% The tax rates listed were all enacted by the beginning of 2018. Instructions (a) Prepare the journal entries for the years 2018-2021 to record income tax expense (benefit) and income tax payable (refundable) and the tax effects of the loss carryback and carryforward, assuming that the end of 2020 it is probable that the benefits of the loss carryforward will be realized in the future. (b) Using the assumption in (a), prepare the income tax section of the 2020 income statement, beginning with the line "Operating loss before income taxes." (c) Prepare the journal entries for 2020 and 2021, assuming that based on the weight of available evidence, it is probable that one-fourth of the benefits of the loss carryforward will not be realized