Theodore Enterprises had the following pretax income (loss) over its first three years of operations: $\begin{array}{rr}
2016 & 500,000 \
2017 & (900,000) \
2018 & 1,500,000
\end{array}$ For each year there were no deferred income taxes and the tax rate was 30%. In its 2017 tax return, Theodore elected a net operating loss carryback. No valuation account was deemed necessary for the deferred tax asset as of December 31, 2017. What was Theodore's income tax expense for 2018?

Question

Quizplus · Accepted Answer

$1,500,000 × 30% = $450,000
The tax benefit from the carryforward was recognized in 2017 and is reversed in 2018. 11ea937b_35c5_d762_a419_5152a44604e0_TB2599_00

Theodore Enterprises Had the Following Pretax Income (Loss) Over Its 2016500,0002017(900,000)20181,500,000\begin{array}{rr}2016 & 500,000 \\2017 & (900,000) \\2018 & 1,500,000\end{array}201620172018​500,000(900,000)1,500,000​

Theodore Enterprises Had the Following Pretax Income (Loss) Over Its $\begin{array}{rr}2016 & 500,000 \\2017 & (900,000) \\2018 & 1,500,000\end{array}$