Question 3 Starlight reported the following pretax financial income (loss) for the years 2018–2021. Pretax Income...

Question 3

Starlight reported the following pretax financial income (loss) for the years 2018–2021.

	Pretax Income (Loss)	Tax Rate
2018	330,000	35%
2019	(60,000)	35%
2020	(800,000)	21%
2021	30,000	21%

Pretax financial income (loss) and taxable income (loss) were the same for all years involved.

Instruction

Prepare the journal entries for the years 2019 to 2021 to record income tax expense and the effects of the net operating loss carryforwards. Additionally, assume that based on the weight of available evidence, the company judged that more likely than not that one-fifth of the benefits of the loss carryforward will not be realized. (7 points)

Expert Solution

Required Journals are done with notes

in cases there are no entry need to be done mentioned as NO Entry with resons

ekkarill92 answered 2 years ago

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