Xanos Corporation faced a 50% marginal tax rate last year and showed the following financial and tax reporting information: Deferred tax asset of $1000. Deferred tax liability of $ 5000. Based only on this information and the news that the tax rate will decline to 40%, Xanos Corporation’ s :（）
A. deferred tax asset will be reduced by $ 400 and deferred tax liability will be reduced by $ 2000.
B. deferred tax liability will be reduced by $1000 and income tax expense will be reduced by $ 800.
C. deferred tax asset will be reduced by $ 200 and the income tax expense will be reduced by $1000.