Problem: ACY operates in the tax jurisdiction of A-land where the currency is the A$. The current year's accounting profit is A$970,000 and the current year's taxable profit is A$780,000. The current tax rate in A-land is 20%. Which of these entries illustrates the correct current tax expense and liability in the financial statements? Solution A.Dr Tax expense: L$156,000. Cr Tax liability: L$156,000. B.Dr Tax liability: L$156,000. Cr Tax expense: L$156,000. C.Dr Tax expense: L$194,000. Cr Tax liability: L$194,000. D.Dr Tax liability: L$194,000. Cr Tax expense: L$194,000.