Exercise $16-25($Algo$)$ Net operating loss carryback and carryforward $[$LO$16-7]$

Wynn Farms reported a net operating loss of $$245,000$ for financial reporting and tax purposes in $2021.$ The enacted tax rate is $25\%.$ Taxable income, tax rates, and income taxes paid in Wynn$$s first four years of operation were as follows:

Taxable

Income Tax

Rates Income Taxes

Paid

$2017$ $ $77,00030\%$ $ $23,100$

$201887,0003026,100$

$2019165,0004066,000$

$202060,0004527,000$

Required:

$1.$ NOL carrybacks are not allowed for most companies, except for property and casualty insurance companies as well as some farm$-$related businesses. Assume Wynn is one of those businesses. Complete the table given below and prepare the journal entry to recognize the income tax benefit of the net operating loss.

$2.$ Show the lower portion of the $2021$ income statement that reports the income tax benefit of the net operating loss.