RECOMMENDED!!Donovan Corp., a calendar-year end company

  

Donovan Corp., a calendar-year end company, operates a profitable division in Jurisdiction A. In January 2017, Jurisdiction A enacted a tax law that changed the tax rate structure from 30 percent to 35 percent. Donovan wants to know whether it needs to adjust its December 31, 2016, tax provision to reflect the rate change. Also, if not in 2016, when does it need to recognize the effect of that change.

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