When Congress changes the tax laws or rates, a corporation's deferred tax liability and asset accounts

A) are not adjusted
B) are adjusted as of the end of the year in which the change occurred
C) are adjusted as of the beginning of the year in which the change occurred
D) are adjusted using the average of the old and new tax rates

Tax Laws

Regulations imposed by governmental agencies in relation to the calculation and payment of taxes by individuals and organizations.

Deferred Tax Liability

A tax obligation that arises when there are temporary differences between the book value and the tax value of assets and liabilities.

Deferred Tax Asset

A Deferred Tax Asset arises when a company pays more tax to the government than it owes in its financial statements, which can be used to reduce tax liability in future periods.