Marigold Corporation had the following tax information. Year Taxable Income Tax

Question

Marigold Corporation had the following tax information.

Year

Taxable Income

Tax Rate

Taxes Paid

In 2018, Marigold suffered a net operating loss of $476,000, which it elected to carry back. The 2018 enacted tax rate is 29%.

Prepare Marigold’s entry to record the effect of the loss carryback. (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 0 for the amounts.)

Account Titles and Explanation

Debit

Credit

Year

Taxable Income

Tax Rate

Taxes Paid

2015 $296,000 35% $103,600 2016 328,000 30% 98,400 2017 402,000 30% 120,600

Explanation / Answer

Account Titles and Explanation Debit Credit Income Tax Refund Receivable($328,000 * 30%) + ($476,000 - $328,000) * 30% $142,800 Benefit Due to Loss Carryback $142,800

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