At the Beginning of the Year, the Balance Sheet of Schrader

question 23

Essay

At the beginning of the year, the balance sheet of Schrader, Inc., shows a $500,000 deferred tax asset relating to a net operating loss carryforward offset by a $90,000 valuation allowance. At the end of the year, Schrader's auditors
agree to release $20,000 of the allowance. Provide the journal entry to record this change in the valuation allowance.