Wynn Farms reported a net operating loss of $285,000 for financial reporting and tax purposes in...

 

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Wynn Farms reported a net operating loss of $285,000 for financial reporting and tax purposes in 2024. 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 Paid $25,500 Income Taxes Tax Rates 30% 30 40 45 28,500 82,000 18,000 1177 2020 2021 $ 85,000 2022 2023 95,000 205,000 40,000 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 2024 income statement that reports the income tax benefit of the net operating loss. Wynn Farms reported a net operating loss of $285,000 for financial reporting and tax purposes in 2024. 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 Paid $25,500 Income Taxes Tax Rates 30% 30 40 45 28,500 82,000 18,000 1177 2020 2021 $ 85,000 2022 2023 95,000 205,000 40,000 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 2024 income statement that reports the income tax benefit of the net operating loss.