Question

The pretax financial income (or loss) figures for Splish Brothers Company are as follows.

2017		83,000
2018		(53,000	)
2019		(36,000	)
2020		115,000
2021		104,000

Pretax financial income (or loss) and taxable income (loss) were the same for all years involved. Assume a 25% tax rate for 2017 and a 20% tax rate for the remaining years.

Prepare the journal entries for the years 2017 to 2021 to record income tax expense and the effects of the net operating loss carryforwards. All income and losses relate to normal operations. (In recording the benefits of a loss carryforward, assume that no valuation account is deemed necessary.) (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.)

Account Titles and Explanation	Debit	Credit
2017
enter an account title to record carryback	enter a debit amount	enter a credit amount
enter an account title to record carryback	enter a debit amount	enter a credit amount
2018
enter an account title to record carryforward	enter a debit amount	enter a credit amount
enter an account title to record carryforward	enter a debit amount	enter a credit amount
2019
enter an account title	enter a debit amount	enter a credit amount
enter an account title	enter a debit amount	enter a credit amount
2020
enter an account title	enter a debit amount	enter a credit amount
enter an account title	enter a debit amount	enter a credit amount
enter an account title	enter a debit amount	enter a debit amount
2021
enter an account title	enter a debit amount	enter a credit amount

Answer 1

Preparing the journal entries for the years 2017 to 2021 to record income tax expense and the effects of the net operating loss carryforwards. All income and losses relate to normal operations.

Account title and Explanation	Debit	Credit
2017
Income tax (83,000 x 25%)	20,750
Provision for Income tax		20,750
2018
Deffered tax (53,000 x 20%) =53,000 x 0.20)	$10,600
To income tax benefit		$10,600
2019
Deffered tax (36,000x 20%) =36,000x 0.20)	$7,200
To income tax benefit		$7,200
2020
Income tax (115,000x 20%) (115,000x 0,20)	$23,000
Deffered tax		$18,600
Provision income tax		$4,400
2021
Income tax (104,000 x 20%) (104,000x 0.20)	$20800
Provision income tax		$20800

Explanation:

For 2018 and 2019, the Charged cost asset is built and loss is taken forward amounting to 10,600 and 7200.
In 2020, the transferred forward loss is balanced and the net tax 22200 - 10600 - 7200 = 4,400 is assigned to Preparation for tax.

Any doubt comment below i will explain or resolve until you got....
PLEASE.....UPVOTE....ITS REALLY HELPS ME....THANK YOU....SOOO MUCH....