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Novotna Inc's only temporary difference at the beginning...

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Accounting

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Novotna Inc's only temporary difference at the beginning and end of 2019 is caused by a $3,000,000 deferred gain for tax purposes for an instaliment sale of a plant asset, and the related receivale fonly one half of which is classiffed as a current asset) bs dus: in equal install ments in 2020 and 2021. The related deferred tax liability at the beginning of the year is $1.200.000. In the third quarter of 2019 , a new tax rate of 20% is enacted into liw and is scheduled to become effective for 2021 . Taxable income for 2019 i5 55,000,000 and taxable income is expected in all future years. (a) Determine the amount reported as 3 deferred tax liatility at the end of 2019. Deferred tax fiablity is eTextbook and Media Prepare the journal entry necessary to adjust the deferred tax liability when the new tax rate is enacted into law. (Credit occount titles are automatically indented when amount is entered. Do not indent manually. II no entry is required, select "No Entry" for the account titles and enter O for the amounts.)

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