McMurray Inc. incurred an accounting and taxable loss for 2020. The corporation therefore decided to use the carryback provisions as it had been profitable up to this year. How should the amounts related to the carryback be reported in the 2020 financial statements?
a The reduction of the loss should be reported as an adjustment to retained earnings.
b The refund claimed should be shown as a reduction of the loss in 2020.
c The refund claimed should be reported as revenue in the current year.
d The refund claimed should be reported as a future charge and amortized over five years.
