Consider the Following:
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Case $A \quad$ Income (Loss) for Quarters 1 Through 4 Is

Essay

Consider the following:
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Case $A \quad$ Income (loss) for quarters 1 through 4 is $( \$ 50,000 ) , \$ 30,000 , \$ 40,000$ , and $\$ 40,000$ , respectively. Future projected income for the year is uncertain at the end of quarters 1 and 2. Annual income at the end of quarter 3 is estimated to be $\$ 20,000$ . No carryback benefit exists, and any future annual benefit is uncertain.

Case B $\quad$ Assume the same facts as in Case A. However, at the end of quarters 1 through 3 , annual income is estimated to be $\$ 40,000$ .

Case C $\quad$ Quarterly income (loss) levels were $\$ 15,000 , ( \$ 35,000 )$ , ( $\$ 75,000 )$ , and $\$ 25,000$ . A yearly operating loss of $\$ 70,000$ was anticipated throughout the year. Frior years' income of $\$ 28,000$ is avail able for carryback. The same tax rates were relevant to the carryback period Required:
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For cases A through C, complete the schedule that follows: Assume that the statutory tax rate is 15% on the first $50,000 of income, 25% on the next $25,000, and 30% on income in excess of $75,000.
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