I am doing a project with a company which is to start its business in coming months. I am preparing its balance sheet for coming years for project and financial planning. In the first two years, it is estimated that they are going to be incurring losses and from third year only they will earn some profit.
My queries are:
How to show the loss incurred on the balance sheet? Under which head?
Does the company will be able to reduce its tax liability in the third year because of the losses earned earlier? If yes, how it could be done?
Looking forward to the responses..