Assume the following: YE June 30 2007 2006 2005 Expected federal income tax (100) 700 685 expense (benefit) at 34% Expenses not deductible 357 32 51 for tax purposes State taxes, net 132 22 100 Change in valuation allowance (150) (766) (754) Income tax expense 239 (12) 82 The $357 adjustment in 2007 most likely resulted in: O an increase in deferred tax assets an increase in deferred tax liabilities Ono change in deferred tax assets or liabilities