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Clive Limited had the following deferred tax balances at reporting date:
Deferred tax assets $32 000
Deferred tax liabilities $55 000
Problem 1: Effective from the first day of the next financial period, the company rate of income tax was reduced from 40% to 35%. The adjustment to income tax expense to recognise the impact of the tax rate change is:
Select one:
Option 1: CR$2 875
Option 2: DR$2 875
Option 3: CR $3 286
Option 4: None of these
Option 5: DR$3 286
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