At the end of 2019, Sentry Company reported a deferred tax liability of $9,724 based on an income tax rate of 26%. On January 2, 2020, Congress changed the income tax rate to 35%. Required: 1. Calculate the amount of the adjustment to Sentry’s 2019 year-end deferred tax liability. 2. Prepare the journal entry to correct Sentry’s deferred tax liability.

PAYROLL ACCT.,2019 ED.(LL)-TEXT
19th Edition
ISBN:9781337619783
Author:BIEG
Publisher:BIEG
Chapter5: Unemployment Compensation Taxes
Section: Chapter Questions
Problem 16PB
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At the end of 2019, Sentry Company reported a deferred tax liability of $9,724 based on an income tax rate of 26%. On January 2, 2020, Congress changed the income tax rate to 35%.
Required:
1. Calculate the amount of the adjustment to Sentry’s 2019 year-end deferred tax liability.
2. Prepare the journal entry to correct Sentry’s deferred tax liability.
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