Carla Vista Co. at the end of 2020, its first year of operations, prepared a reconciliation between pretax financial income and taxable income as follows:

Pretax financial income	$1050000
Estimated litigation expense	2750000
Installment sales	(2200000)
Taxable income	$1600000

The estimated litigation expense of $2750000 will be deductible in 2022 when it is expected to be paid. The gross profit from the installment sales will be realized in the amount of $1100000 in each of the next two years. The estimated liability for litigation is classified as noncurrent and the installment accounts receivable are classified as $1100000 current and $1100000 noncurrent. The income tax rate is 20% for all years. The deferred tax liability to be recognized is

$320000.

$220000.

$110000.

$440000.