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Question - Starlight reported the following pretax financial income (loss) for the years 2015-2019.
Pretax Income (Loss)
Tax Rate
2017
330,000
35%
2018
(60,000)
2019
(800,000)
21%
2020
30,000
Pretax financial income (loss) and taxable income (loss) were the same for all years involved.
Prepare the journal entries for the years 2018 to 2020 to record income tax expense and the effects of the net operating loss carry forwards. Additionally, assume that on December 31, 2019, based on the weight of available evidence, the company judged that more likely than not that one-fifth of the benefits of the loss carry forward will not be realized.
Using the attached T-account template: Record the balances indicated above. Label the balances "Bal"
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