Company T had the following information for the years 19C-19E:
Income Before Tax Taxes
Tax Rate Paid
•19C 30,000 25% 7,500
•19D 20,000 30% 6,000
•19E (90,000) 30% -0-
(1) Prepare journal entries in 19E for the carryback and carryforward (assume it is more likely than not that future years will generate positive net income, and the future tax rate will be 40%).
(2) Show an income statement for 19E.