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Tyson Corporation reported pretax income from operations in Year 1 of $224,000 (the first year of operations). In Year 2, the corporation experienced a $112,000
Tyson Corporation reported pretax income from operations in Year 1 of $224,000 (the first year of operations). In Year 2, the corporation experienced a $112,000 NOL (pretax loss from operations). Management is confident the company will have taxable income in excess of $140,000 in Year 3. Assume an income tax rate of 25% in Year 1 and thereafter. Tyson has no other temporary differences. a. Provide the Year 1 and Year 2 income tax entries that Tyson should make. b. Show how all tax-related items would be reported on the Year 1 and Year 2 income statements and balance sheets
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