Business, 14.05.2021 02:00 Levantine3667

Tobac Company reported an operating loss of $141,000 for financial reporting and tax purposes in 2021. The enacted tax rate is 25% for 2021 and all future years. Assume that Tobac operates in an industry for which NOL carryback is allowed and elects a loss carryback. No valuation allowance is needed for any deferred tax assets. Taxable income, tax rates, and income taxes paid in Tobac's first four years of operations were as follows: Taxable income Tax rates Taxes paid
2017 $39,000 30% $11,700
2018 $44,000 30% $13,200
2019 $51,000 35% $17,850
2020 $49,000 40% $19,600

Required:
a. Prepare a compound journal entry to record Tobac's tax provision for the year 2021.
b. Compute Tobac's net loss for 2021.

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Tobac Company reported an operating loss of $141,000 for financial reporting and tax purposes in 202...

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