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(b) Using the assumption in (a), prepare the income tax section of the 2020 income statement beginning with the line "Operating loss before income taxes."

(c) Prepare the journal entries for 2020 and 2021, assuming that based on the weight of available evidence, it is more likely than not that one-fourth of the benefits of the loss carryforward will not be realized.

(d) Using the assumption in (c), prepare the income tax section of the 2020 income statement beginning with the line "Operating loss before income taxes."

Swifty Inc. reports the following pretax income (loss) for both financial reporting purposes and tax purposes. Year 2018 2019 2020 2021 Pretax Income (Loss) $113,000 110,000 (206,000) 314,000 Tax Rate 17% 17% 19 % 19% The tax rates listed were all enacted by the beginning of 2018. (a) Prepare the journal entries for the years 2018-2021 to record income tax expense (benefit) and income taxes payable (refundable) and the tax effects of the loss carryforward, assuming that at the end of 2020 the benefits of the loss carryforward are judged more likely than not to be realized in the future. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts.) Debit Credit Date Account Titles and Explanation 2018 2019 2020 2021

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