Brief Exercise 19-13 Sage Inc. incurred a net operating loss of $484,000 2017 Co

Question

Brief Exercise 19-13 Sage Inc. incurred a net operating loss of $484,000 2017 Combined i come for 2015 and 2016 was $360,000. The tax rate for all years is 30% Sage elects the carryback op ion. Prepare the ournal entries to record the benefits of the loss carryback and the loss carryforward. Sage expects to return to profitability in 2018. (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 To record carryback.) To record carryforward.)

Explanation / Answer

Income Tax Refund Receivable 108000 =360000*30%         Benefit Due to Loss Carryback 108000 Deferred Tax Asset 37200 =(484000-360000)*30%         Benefit Due to Loss Carryforward 37200

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