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

2017 .................. € 160,000
2018 ..................... 250,000
2019 .................... € 80,000
2020 ................... (160,000)
2021 ................... (380,000)
2022 .................... 120,000
2023 .................... 100,000

Pretax financial income (or loss) and taxable income (loss) were the same for all years involved. Assume a 45% tax rate for 2017 and 2018, and a 40% tax rate for the remaining years.

Instructions

Prepare the journal entries for the years 2019–2023 to record income tax expense and the effects of the net operating loss carrybacks and carryforwards, assuming Lynchburg Company uses the carryback provision. All income and losses relate to normal operations. In recording the benefits of a loss carryforward, assume that it is probable that the full amount will be realized.