Question

Cheyenne Corporation had the following tax information. Year Taxable Income Tax Rate Taxes Paid 2015 $306,000...

Cheyenne Corporation had the following tax information.

Year

Taxable Income

Tax Rate

Taxes Paid

2015 $306,000 34% $104,040
2016 324,000 29% 93,960
2017 393,000 29% 113,970


In 2018, Cheyenne suffered a net operating loss of $488,000, which it elected to carry back. The 2018 enacted tax rate is 28%.

Prepare Cheyenne’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

0 0
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Answer #1
Answer

Account Title

Debit Credit
Income Tax Refund Receivable $      141,520 488000*29%
        Benefit Due to Loss Carryback $      141,520
(To record income tax benefit for loss carryback)
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