This is excercise in my class E19-9B, i have questions of Journal entry of year 2016. From the solution in my class is:

Deferred Tax Asset....................................................... 17,500

Benefit Due to Loss Carryforward

(Income Tax Expense)

($50,000 X 35%)................................................. 17,500

I just do not understand why we have 50000x35%. and why we have benefit loss carry forward? Before year 2016, in the year 2015 we have $70000. Can i carry back by using $70000 in 2015 to recover of loss $50000 in year 2016. Can i do my journal entry like this:

Refund receivable.................17500

Benefit due to loss carryback .................17500

Note: ($50,000 X 35%=17500)

E19-9B (Carry back and Carryforward of NOL, No Valuation Account, No Temporary Differences) The pretax financial income (or loss) figures for Metals, Inc. are as follows. 2011 90,000 2012 65,000 2013 40,000 2014 (230,000) 2015 70,000 (50,000) 2016 2017 80,000 Pretax financial income (or loss) and taxable income (oss) were the same for all years involved. Assume a 40% tax rate for 2011 and 2012 and a 35% tax rate for the remaining years. Instructions Prepare the journal entries for the years 2014 to 2017 to record income tax expense and the effects of the net operating loss carrybacks and carryforwards assuming Metals, Inc. uses the carryback provision. All income and losses relate to normal operations. (In recording the benefits of a loss carryforward, assume that no valuation account is deemed necessary.)