Why does this question work the way it does?

I expected the DTA to be 850,000 * 25% or 21,250.

Instead, the company is able to deduct a full 500,000 from the next year's account, and reduce it by the maximum 80%.

In Its first four years of operations Bellow Corp., a software company, reported the following operating income (loss) amounts: 13 1010 points awarded 2021 $ 300,000 2022 (850,088) 2023 500,000 2024 900,000 Scored There were no other deferred Income tax amounts in any year. The enacted Income tax rate was 25% in all years. What will be Bellow's 2023 tax payable? eBook Multiple Choice Prins Reference: O (07.500) O SO $25,000 $100.000 Explanation Bellow's industry does not qualify for NOL carryback. ($500.000 - (90% 5500,000) 25% = $25.000