Question

The pretax financial income (or loss) figures for Jenny SpanglerCompany are as follows.

2009

 

$178,800

 

2010

 

263,100

 

2011

 

86,700

 

2012

 

(178,800

)

2013

 

(400,700

)

2014

 

131,500

 

2015

 

105,100

 

 

Pretax financial income (or loss) and taxable income (loss) werethe same for all years involved. Assume a 35% tax rate for 2009 and2010 and a 30% tax rate for the remaining years.

Prepare the journal entries for the years 2011 to 2015 to recordincome tax expense and the effects of the net operating losscarrybacks and carryforwards assuming Jenny Spangler Company usesthe carryback provision. All income and losses relate to normaloperations. (In recording the benefits of a loss carryforward,assume that no valuation account is deemed necessary.)