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Example #4- Net Operating Losses Times Hungry Corp. has had no permanent or...

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Accounting

Example #4- Net Operating Losses
Times Hungry Corp. has had no permanent or temporary
differences since it began operations. Information regarding
taxable income and taxes paid is as follows:
The tax rate enacted for Year 6 and subsequent years is 25%.
(a) Prepare the journal entry to record the expected benefits of
any related NOL carryforward. Assume it is likely that the
benefits of any carryforward will be fully realized.
(b) How are the accounts in the journal entries prepared in (a)
to be reported in the financial statements for Year 5?
(c) Assume taxable income is $100,000(before considering
the NOL carryforward) in Year 6. Prepare the journal entry
to record income taxes.
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