The Wyatt Company Reports the Following for Both Pretax Financial

question 74

Multiple Choice

The Wyatt Company reports the following for both pretax financial and taxable income:
Wyatt uses the carryback provision for net operating losses when possible. Congress has enacted a tax rate for 2020 and future years of 40%. The entry on December 31, 2019, to record income tax expense would include a

• A) debit to Income Tax Refund Receivable for $24,000.
• B) debit to Income Tax Refund Receivable for $45,000.
• C) credit to Income Tax Benefit from Operating Losses for $45,000.
• D) credit to Income Tax Expense for $45,000.

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Definitions:

Presumed Competence

The assumption that an individual is capable and knowledgeable in a certain area without needing explicit evidence.

Primary Group

A group with strong emotional ties and bonds that endure over time. This type of group tends to be more informal and intimate than other groups that individuals belong to. See also Secondary group.

Secondary Group

A group that is formal and impersonal, often organized around instrumental goals. See also Primary group.

Ethnocentrism

In intergroup relations, the tendency to regard one’s own group as the center of everything and to evaluate other groups in reference to it; the tendency to regard one’s in-group as superior to all out-groups.