For the year ended December 31, year 3, Colt Corp. has a loss carryforward of $180,000 available

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Question:

For the year ended December 31, year 3, Colt Corp. has a loss carryforward of $180,000 available to offset future taxable income. At December 31, year 3, all available evidence concerning future profitability is positive. Assume an income tax rate of 30%. What amount of the tax benefit should be reported in Colt’s year 3 income statement?

a. $ 54,000

b. $0

c. $180,000

d. $126,000