Sabbie Corporation, incorporated in 2018 had the following data.

2018 2019

Accounting income before tax: $ 210,000 $270,000

Items included in arriving at income before tax:

Golf dues 8,000 9,000

Dividends received from a Canadian corp. 20,000 60,000

Depreciation expense 100,000 100,000

Warranty expense 50,000 60,000

Additional information:

Capital cost allowance 150,000 160,000

Warranty costs paid for 30,000 70,000

The tax rate in effect is 32% for 2018 and 35% for 2019.

Required:

1. Prepare a tax reconciliation for 2018 and 2019. ie. Calculate taxable income and tax payable.
2. Prepare journal entries for 2018 and 2019.
3. Prepare a partial balance sheet for 2018 and 2019.
4. Prepare the Income Tax Expense disclosure required on the Income Statement for 2018 and 2019.

e) Assume that in 2020 (the following year), the taxable loss was $475,000. What would be the journal entry to record the loss carryback and carryforward, assuming management estimates that it is probable that the loss carryforward will be used.