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Taylor Company reported an operating loss of $123,000 for financial reporting and tax purposes in 2021. The enacted tax rate is 25% for 2021 and

Taylor Company reported an operating loss of $123,000 for financial reporting and tax purposes in 2021. The enacted tax rate is 25% for 2021 and all future years. Assume that Taylor operates in an industry for which NOL carryback is allowed and elects a loss carryback. No valuation allowance is needed for any deferred tax assets. Taxable income, tax rates, and income taxes paid in Taylor's first four years of operations were as follows:

2017: Taxable income $29,000; tax rate 30%; taxes paid $8,700.

2018: Taxable income $37,000; tax rate 30%; taxes paid $11,100.

2019: Taxable income $40,000; tax rate 40%; taxes paid $16,000.

2020: Taxable income $43,000; tax rate 35%; taxes paid $15,050.

Required: 1. Prepare a compound journal entry to record Taylors tax provision for the year 2021.

2. Compute Taylor's net loss for 2021.

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