A company has a Deferred Tax Asset of $35,000. Now, the government has just changed the statutory tax rate from 35% to 30% effective immediately.

What is the correct journal entry to record the impact of this tax rate change?

Dr. Income Tax Payable 5000 Cr. Deferred Tax Assets 5000

Dr. Income Tax Expense 5000 Cr. Income Tax Payable 5000

Dr. Income Tax Expense 5000 Cr. Deferred Tax Assets 5000

Dr. Deferred Tax Assets 5000 Cr. Income Tax Expense 5000

Dr. Deferred Tax Assets 5000 Cr. Income Tax Payable 5000