Wynn Sheet Metal reported an operating loss of $172,000 for financial reporting and tax purposes in 2018. The enacted tax rate is 40%. Taxable income, tax rates, and income taxes paid in Wynn's first four years of operation were as follows:

Taxable

Income Tax

Rates Income Taxes

Paid 2014 $ 66,000 30 % $ 19,800 2015 76,000 30 22,800 2016 86,000 40 34,400 2017 66,000 45 29,700

Required:

1. Complete the following table given below and prepare the journal entry to recognize the income tax benefit of the operating loss. Wynn elects the carryback option.

2. Show the lower portion of the 2018 income statement that reports the income tax benefit of the operating loss.