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Elwood Ltd has the following deferred tax balances as at 30 June 2019

Accounting

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Elwood Ltd has the following deferred tax balances as at 30 June 2019.Deferred tax asset  1,000,000

Deferred tax liability 800,000

 

The above balances were calculated when the tax rate was 30%. On 1 December 2019 the government raises the corporate tax rate to 35 per cent.

Provide the journal entries to adjust the carry-forward balances of the deferred tax asset and deferred tax liability.

 

Please provide journal entries with explanation if possible