LossCo reported a net operating loss of $5 million for financial reporting and tax purposes. The enacted tax rate is 25%. Assume that LossCo does not qualify as a type of company that is allowed to carry back an NOL to prior taxable years. Prepare the journal entry to recognize the income tax benefit of the net operating loss. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.

Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter18: Accounting For Income Taxes
Section: Chapter Questions
Problem 9MC: Brooks Company reported a prior period adjustment of 512,000 in pretax financial "income" and...
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LossCo reported a net operating loss of $5 million for financial reporting and tax purposes. The enacted tax rate is 25%. Assume that LossCo does not qualify as a type of company that is allowed to carry back an NOL to prior taxable years.

Prepare the journal entry to recognize the income tax benefit of the net operating loss.

Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.

 
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