Wynn Farms reported a net operating loss of $225,000 for financial reporting and tax purposes in 2021. The enacted tax rate is 25%. Taxable income, tax rates, and income taxes paid in Wynns first four years of operation were as follows:

Taxable Income Tax Rates Income Taxes Paid

2017 $ 73,000 30 % $ 21,900

2018 83,000 30 24,900

2019 145,000 40 58,000

2020 40,000 45 18,000

Required: 1. NOL carrybacks are not allowed for most companies, except for property and casualty insurance companies as well as some farm-related businesses. Assume Wynn is one of those businesses. Complete the table given below and prepare the journal entry to recognize the income tax benefit of the net operating loss. 2. Show the lower portion of the 2021 income statement that reports the income tax benefit of the net operating loss.
Check my work mode : This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion. Return to question Required 1 Calculation Required 1 G Required 2 NOL carrybacks are not allowed for most companies, except for property and casualty insurance companies as well as some farm- related businesses. Assume Wynn is one of those businesses. Complete the following table to recognize the income tax benefit of the net operating loss. (Enter your answers in whole dollars. Leave no cell blank, enter "0" wherever applicable. Enter all amounts as positive values.) Operating loss carryback Tax $ Recorded as: Rate % 30% Carried back - 2017 $ 0 0 0 x 30% = $ 0 Carried back - 2018 Carried back - 2019 Carried back - 2020 40% = $ 56 140 x x 50 X X 45% = $ 23 $ 79 Income tax expense Total carryback Operating loss carryforward Carried forward 200 X X 25% $ 50 Deferred tax asset-ending Check my work mode : This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion. Return to question Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Calculation Required 1 GJ Required 2 Prepare the journal entry to recognize the income tax benefit of the net operating loss. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) No Event General Journal Debit Credit 1 1 76 % Receivable-Income tax refund Deferred tax asset 10

Question

Wynn Farms reported a net operating loss of $225,000 for financial reporting and tax purposes in 2021. The enacted tax rate is 25%. Taxable income, tax rates, and income taxes paid in Wynns first four years of operation were as follows:

	Taxable Income		Tax Rates		Income Taxes Paid
2017	$	73,000	30	%	$	21,900
2018		83,000	30			24,900
2019		145,000	40			58,000
2020		40,000	45			18,000

Required: 1. NOL carrybacks are not allowed for most companies, except for property and casualty insurance companies as well as some farm-related businesses. Assume Wynn is one of those businesses. Complete the table given below and prepare the journal entry to recognize the income tax benefit of the net operating loss. 2. Show the lower portion of the 2021 income statement that reports the income tax benefit of the net operating loss. image text in transcribed

Check my work mode : This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion. Return to question Required 1 Calculation Required 1 G Required 2 NOL carrybacks are not allowed for most companies, except for property and casualty insurance companies as well as some farm- related businesses. Assume Wynn is one of those businesses. Complete the following table to recognize the income tax benefit of the net operating loss. (Enter your answers in whole dollars. Leave no cell blank, enter "0" wherever applicable. Enter all amounts as positive values.) Operating loss carryback Tax $ Recorded as: Rate % 30% Carried back - 2017 $ 0 0 0 x 30% = $ 0 Carried back - 2018 Carried back - 2019 Carried back - 2020 40% = $ 56 140 x x 50 X X 45% = $ 23 $ 79 Income tax expense Total carryback Operating loss carryforward Carried forward 200 X X 25% $ 50 Deferred tax asset-ending Check my work mode : This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion. Return to question Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Calculation Required 1 GJ Required 2 Prepare the journal entry to recognize the income tax benefit of the net operating loss. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) No Event General Journal Debit Credit 1 1 76 % Receivable-Income tax refund Deferred tax asset 10