Brief Exercise 16-12 Net operating loss carryforward [LO16-7) 4 During its first

Question

Brief Exercise 16-12 Net operating loss carryforward [LO16-7) 4 During its first year of operations, Nile.com reported a net operating loss of $15 milion for f enacted tax rate is 40 financial reporting and tax purposes. The fit of the net operating loss. (If no entry is required for a tra Prepare the journal entry to recognize the income tax select "No journal entry required in the first account field. Enter your answers in whole dollars) Journal entry worksheet Record the income tax beneft of the operating loss Nobe: Enter

Explanation / Answer

Answer:

Accounting title and explanation

Debit $

Credit $

Deferred Tax Assets

      6,000,000

Income Tax Benefit-Operating Loss

    6,000,000

Explanation to the answer:

This is the first year of operation of the Nile.Com so carry back option is unavailable so Loss can be carries forward

Deferred tax Assets ($ 15 million x tax rate)

=$ 15 million x 40%

=$6,000,000

Accounting title and explanation

Debit $

Credit $

Deferred Tax Assets

      6,000,000

Income Tax Benefit-Operating Loss

    6,000,000

Related Questions

Navigate

• Browse (All)
• Browse B
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.