Reference no: EM132085522

Question: Waterway Inc. reported the following pretax income (loss) and related tax rates during the years 2013-2019. Pretax Income (loss) Tax Rate 2013 $39,000 30 % 2014 22,700 30 % 2015 49,900 30 % 2016 74,800 40 % 2017 (181,900 ) 45 % 2018 68,600 40 % 2019 96,500 35 % Pretax financial income (loss) and taxable income (loss) were the same for all years since Waterway began business. The tax rates from 2016-2019 were enacted in 2016. Prepare the journal entries for the years 2017-2019 to record income taxes payable (refundable), income tax expense (benefit), and the tax effects of the loss carryback and carryforward. Assume that Waterway elects the carryback provision where possible and expects to realize the benefits of any loss carryforward in the year that immediately follows the loss year. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Prepare the portion of the income statement, starting with "Operating loss before income taxes," for 2017. (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Prepare the portion of the income statement, starting with "Income before income taxes," for 2018. (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)