Argus Limited has a provision for maternity leave liability amounting to $60,000. The maternity leave costs are not tax deductible until paid out to employees. The company tax rate is 30%. Assuming no other temporary differences exist, which of the following deferred tax items does the company have?

Select one:

a.

A deferred tax asset of $60,000.

b.

A deferred tax liability of $60,000.

c.

A deferred tax liability of $18,000.

d.

A deferred tax asset of $18,000.