Nickerson Corporation began operations in 2013. There have been no permanent or temporary differences to account for since the inception of the business. The following data are available: Year Enacted Tax Rate Taxable Income 2013 45% 2014 40% 2015 35% 2016 30% $1,500,000 1,800,000 Taxes Paid $675,000 720,000 In 2015, Nickerson had an operating loss of $1,860,000. What amount of income tax benefits should be reported on the 2015 income statement due to this loss assuming that it uses the carryback provision?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Nickerson Corporation began operations in 2013. There have been no permanent or temporary
differences to account for since the inception of the business. The following data are available:
Year Enacted Tax Rate Taxable Income
2013 45%
2014 40%
2015 35%
2016 30%
$1,500,000
1,800,000
Taxes Paid
$675,000
720,000
In 2015, Nickerson had an operating loss of $1,860,000. What amount of income tax benefits should
be reported on the 2015 income statement due to this loss assuming that it uses the carryback
provision?
Transcribed Image Text:Nickerson Corporation began operations in 2013. There have been no permanent or temporary differences to account for since the inception of the business. The following data are available: Year Enacted Tax Rate Taxable Income 2013 45% 2014 40% 2015 35% 2016 30% $1,500,000 1,800,000 Taxes Paid $675,000 720,000 In 2015, Nickerson had an operating loss of $1,860,000. What amount of income tax benefits should be reported on the 2015 income statement due to this loss assuming that it uses the carryback provision?
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