Tree Co. manufactures custom hammers for roofers. Tree Co. had a single temporary difference of $36 million and reported a deferred tax liability of $9 million as of 12/31/2022, when the enacted tax rate was 25%. The entire $36 million temporary difference will reverse in 2024, at which time the deferred tax liability will become payable. Assume a new tax law is enacted in 2023 that changes the 2024 tax rate from 25% to 15% (the rate remains 25% for 2023). Tree Co.s 2023 taxable income is $46 million.

1. Prepare the journal entry/entries to record Tree Co.s 2023 income taxes.
2. What effect, if any, will the change in enacted tax rates have on Tree Co.s 2023 net income?