Georgia, Inc. has no temporary or permanent differences. The company experiences
ID: 2521063 • Letter: G
Question
Georgia, Inc. has no temporary or permanent differences. The company experiences the following:
Year
Taxable income/loss
Tax rate
Tax paid
2014
$ 100,000
35%
$ 35,000
2015
200,000
30%
60,000
2016
400,000
40%
160,000
2017
(500,000)
----
-0-
In 2017, Georgia, Inc. decides to carry back its NOL. What amount of income tax refund receivable will Georgia record for 2017?
a. $200,000
b. $180,000
c. $190,000
d. $ -0-
Year
Taxable income/loss
Tax rate
Tax paid
2014
$ 100,000
35%
$ 35,000
2015
200,000
30%
60,000
2016
400,000
40%
160,000
2017
(500,000)
----
-0-
Explanation / Answer
THE 500000 NOL CARRY BACK PAST 2 YEARS .
INCOME TAX REFUND CAN BE CALUCULATED AS FOLLOWS
YEAR TAXABLE INCOME INCOME TAX REFUND
2016 400000 160000
2015 (NOTE) 100000 30000
TOTAL REFUND 190000
NOTE : IN 2015 WE TAKW ONLY 100000 BECAUSE OUR LOSS IS 500000 , WE CLAIMING REFUND FROM 2016 AND 2105 SO WE REQUIRED AMOUNT IN 2015 IS 100000 ONLY ( 500000-400000)
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