Sunland Co. had a deferred tax liability balance due to a temporary difference at the beginning of 2024 related to $1440000 of excess depreciation. In December of 2024, a new income tax act is signed into law that lowers the corporate rate from 30% to 25%, effective January 1, 2026. If taxable amounts related to the temporary difference are scheduled to be reversed by $720000 for both 2025 and 2026, Sunland should increase or decrease deferred tax liability by what amount? O decrease by $72000 O increase by $36000 O decrease by $36000 O increase by $72000

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue autho…