On Jan 1 year 1, 1,000,000 was collected in advance for rental of a building for a 5 year period. The entire 1,000,000 was reported as taxable income for the year. The enacted tax rate for this year is 44%. The enacted tax rate for all future years was 46%. As a result of change in the tax law, the enacted tax rate for years all years after year 3 is 45%. Compute the balance in the deferred tax asset at Dec 31, year 2

Make journal entry to record income tax expense at Dec 31 year 2, assuming income tax payable is 1,749,000