Record the carry back and carry forward decision

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Reference no: EM13929757

Colorado Company has provided you the following information. Year Taxable income Income tax rate 2014 $390,000 35% 2015 $320,000 37% 2016 $400,000 40% 2017 ($1,200,000) 40% Colorado Company has decided to use the loss carry back and carry forward provision as a result of the year 2017 loss. The enacted tax rate remains at 40% after year 2017. Colorado Company has determined that a valuation allowance is not necessary. Prepare the journal entry on December 31, 2017 to record the carry back and carry forward decision.

Reference no: EM13929757

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