Question: Addison Ltd. has one temporary difference at the beginning of 2018 of 500,000. The deferred tax liability established for this amount is 150,000, based on

Addison Ltd. has one temporary difference at the beginning of 2018 of £500,000. The deferred tax liability established for this amount is £150,000, based on a tax rate of 30%. The temporary difference will provide the following taxable amounts: £100,000 in 2019, £200,000 in 2020, and £200,000 in 2021. If a new tax rate for 2021 of 20% is enacted into law at the end of 2018, what is the journal entry necessary in 2018 (if any) to adjust deferred taxes?

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