A Company Has a Deferred Tax Liability of $120,000 at the Beginning

question 32

Essay

A company has a deferred tax liability of $120,000 at the beginning of the fiscal year relating to a taxable temporary difference of $300,000. The current year tax rate is 20%.
Required:
Provide the journal entry to reflect the tax rate change.

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Definitions:

Teratogenic

Pertaining to or capable of causing birth defects or developmental abnormalities in an embryo or fetus.

Caffeine

A stimulant found in coffee, tea, and other beverages, known to enhance alertness and energy levels.

Coffee

A brewed drink prepared from roasted coffee beans, which are the seeds of berries from the Coffea plant.

Moderate Drinking

Consuming alcohol in a manner that is within recommended guidelines and limits, minimizing health risks.