Sondgeroth inc reports the following pretax income loss for

Reference no: EM13590635

NOL Carryback and Carryforward, Valuation Account versus No Valuation Account)

Sondgeroth Inc. reports the following pretax income (loss) for both financial reporting purposes and tax purposes. (Assume the carryback provision is used for a net operating loss.)

Year Pretax Income (Loss) Tax Rate

2009 $110,000 34%
2010 90,000 34%
2011 (260,000) 38%
2012 220,000 38%

The tax rates listed were all enacted by the beginning of 2009.

(a) Prepare the journal entries for the years 2009-2012 to record income tax expense (benefit) and income tax payable (refundable) and the tax effects of the loss carryback and carryforward, assuming that at the end of 2011 the benefits of the loss carryforward are judged more likely than not to be realized in the future. (List multiple debit/credit entries from largest to smallest amount, e.g. 10, 5, 2.)

(b) Using the assumption in (a), prepare the income tax section of the 2011 income statement beginning with the line "Operating loss before income taxes." (For negative numbers use either a negative sign preceding the number, e.g. -45 or parenthesis, e.g. (45).)

(c) Prepare the journal entries for 2011 and 2012, assuming that based on the weight of available evidence, it is more likely than not that one-fourth of the benefits of the loss carryforward will not be realized. (List multiple debit/credit entries from largest to smallest amount, e.g. 10, 5, 2.)

(d) Using the assumption in (c), prepare the income tax section of the 2011 income statement beginning with the line "Operating loss before income taxes." (For negative numbers use either a negative sign preceding the number, e.g. -45 or parenthesis, e.g. (45).)

Reference no: EM13590635

Questions Cloud

A fire hose ejects a stream of water at an angle of 365 : question a fire hose ejects a stream of water at an angle of 36.5 degrees above the horizontal. the water leaves the

For lodes company the relevant range of production is : for lodes company the relevant range of production is 40-80 of cppacity. at 40 of capacity a variable cost is 4000 and

Frank fronton decided to become a professional jai alai : frank fronton decided to become a professional jai alai player. in january fronton joined a jai alai club where he

Aampfs stock price has been going down for weeks an analyst : aampfs stock price has been going down for weeks. an analyst investigating the company discovers that aampf has a

Sondgeroth inc reports the following pretax income loss for : nol carryback and carryforward valuation account versus no valuation accountsondgeroth inc. reports the following

Trumpet company produced 4800 units of product that : trumpet company produced 4800 units of product that required 2.3 standard hours per unit. the standard variable

A biologist has two brine solutions one containing 3 salt : a biologist has two brine solutions one containing 3 salt and another containing 12 salt. how many millimiters of

Accounts receivable from sales transaction were 51000 at : accounts receivable from sales transaction were 51000 at the beginning of the year and 64000 at the end of the year.

Saver company produces only one product monthly fixed : saver company produces only one product. monthly fixed expenses are 20000 monthly unit sales are 3500 and the unit

User Account

All Pages