Which of the following evidence would be considered negative in determining whether Gratiot Corporation needs to record a valuation allowance for some or all of its deferred tax assets?
a) The company forecasts future taxable income because of its backlog of orders.
b) The company has a cumulative net loss over the current and prior two years.
c) The company has unfavorable temporary differences that will create future taxable income when they reverse.
d) The company had a net operating loss carryover expire in the current year.
e) Both (b) and (d) constitute negative evidence in assessing the need for a valuation allowance.