Question: Yuyu company reported its profit (loss) before taxes/pretax financial income (loss) for 2013-2017 as follows: $240,000, $350,000,$90,000,$(550,000), and $180,000. Tax rate used is 25%.
a) Prepare journal entries to record income tax expense, income tax payable, and effect from loss carryback & loss carryforward. (with assumptions in the fifth year after tax loss, loss carryforward can't be done).
b) How is the presentation of tax expense in income statement, starting from Loss Before Taxes section?