At December 31, 2020, Higley Corporation has one temporary difference which will reverse and cause taxable amounts in 2021. In 2020, a new tax act set taxes equal to 35% for 2020, 30% for 2021, and 20% for 2022 and years thereafter. Instructions Explain what circumstances would call for Higley to compute its deferred tax liability at the end of 2020 by multiplying the cumulative temporary difference by:

a. 45%.

b. 40%.

c. 20%.