Ross Company has been in business for several years, during which time it has been profitable. For each of those years, Ross reported (and paid taxes on) taxable income in the same amount as pretax financial income based on the following revenues and expenses:

	Revenues	Expenses
2012	$182,000	$150,000
2013	220,000	170,000
2014	253,000	180,000
2015	241,000	196,000

Ross was subject to the following income tax rates during this period: 2012, 20%; 2013, 25%; 2014, 30%; and 2015, 25%. During 2016, Ross experienced a severe decrease in the demand for its products. The company tried to offset this decrease with an expensive marketing campaign, but was unsuccessful. Consequently, at the end of 2016, Ross determined that its revenues were $60,000 and its expenses were $193,000 during 2016 for both income taxes and financial reporting.

Ross Company decided to carry back its 2016 operating loss. Furthermore, since Ross had already begun to develop the new product at the end of 2016 and had contracts for its sale in 2017, the company was confident at the end of 2016 that it would earn sufficient taxable income in the future carryforward period.

In 2017, Ross developed and introduced a new product that proved to be in high demand. On June 1, 2017, Ross received a refund check from the government based on the tax information it filed at the end of 2016. For 2017, Ross reported revenues of $181,000 and expenses of $155,000 for both income taxes and financial reporting. The applicable income tax rate was 30%.

Required:

1.	Prepare Rosss income tax journal entries at the end of 2016.
2.	Prepare Rosss 2016 income statement. Include a note for any operating loss carryforward recognition.
3.	Prepare the journal entry to record the receipt of the refund check on June 1, 2017.
4.	Prepare the income tax journal entry at the end of 2017.
5.	Prepare Rosss 2017 income statement.