Kinney Enterprises reported a taxable net income of $297,000 in 2016. The first $50,000 is taxed at 15%, the next $25,000 at 25%, the next $25,000 at 34%, and the remaining portion at 39%. If they had a deferred tax liability on an unrealized holding gain of $50,000, what tax rate should they use to compute their deferred tax liability?

A :

33.36%

B :

37.93%

C :

26.00%

D :

31.47%